Otis Worldwide Corp (OTIS)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|
| Gross profit margin | 85.61% | 85.98% | 85.16% | 29.91% |
| Operating profit margin | 15.55% | 15.01% | 14.88% | 12.97% |
| Pretax margin | 13.79% | 13.09% | 12.62% | 10.77% |
| Net profit margin | 10.00% | 9.25% | 8.80% | 7.17% |
The profitability ratios of Otis Worldwide Corp, as indicated by the gross profit margin, operating profit margin, pretax margin, and net profit margin, have shown a generally positive trend over the past five years.
The gross profit margin has been relatively stable, ranging between 28.64% and 29.63%, indicating the company's ability to manage its production costs efficiently.
The operating profit margin has also shown improvement over the years, with a significant increase from 13.35% in 2020 to 15.24% in 2023. This suggests that Otis Worldwide Corp has been successful in controlling its operating expenses and generating profits from its core business activities.
Similarly, the pretax margin and net profit margin have both shown an upward trend, highlighting the company's ability to increase profitability before and after tax deductions. Specifically, the net profit margin increased from 7.10% in 2020 to 9.90% in 2023, indicating an improvement in bottom-line profitability.
Overall, the profitability ratios of Otis Worldwide Corp demonstrate a positive trajectory, reflecting strong operational efficiency and effective cost management, leading to enhanced profitability over the years.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 21.61% | 20.70% | 17.17% | 15.30% |
| Return on assets (ROA) | 13.90% | 12.76% | 10.15% | 8.46% |
| Return on total capital | 112.56% | 165.55% | 58.17% | 117.07% |
| Return on equity (ROE) | — | — | — | — |
Otis Worldwide Corp has shown a consistent improvement in its profitability ratios over the years. The Operating Return on Assets (Operating ROA) has increased steadily from 2019 to 2023, indicating that the company's operating performance in generating profit from its assets has been improving. This suggests efficient asset utilization.
Similarly, the Return on Assets (ROA) has also displayed an upward trend, pointing towards the company's ability to generate profit relative to its total assets over the years. This indicates an improvement in the overall profitability efficiency of the company.
The Return on Total Capital has shown significant fluctuations over the years, with a notable increase in 2023 compared to the previous years. This could imply that the company has been more efficient in generating returns for both shareholders and debt holders, reflecting a positive utilization of all capital resources.
Unfortunately, the information provided does not include the Return on Equity (ROE) for Otis Worldwide Corp, making it challenging to assess the company's profitability in relation to shareholder equity specifically. It is important to note that ROE is a fundamental measure of how effectively a company uses its equity to generate profits.
Overall, the trends in the profitability ratios suggest that Otis Worldwide Corp has been successful in enhancing its profitability and efficiency in utilizing its assets and capital resources over the years.