Quidel Corporation (QDEL)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 46.23% | 42.87% | 59.28% | 74.82% | 81.17% |
| Operating profit margin | -70.46% | 8.23% | 25.83% | 53.34% | 63.81% |
| Pretax margin | -76.59% | -0.97% | 22.53% | 53.01% | 62.61% |
| Net profit margin | -72.84% | -0.34% | 16.80% | 41.46% | 48.76% |
The profitability ratios of Quidel Corporation have shown a declining trend over the years.
1. Gross Profit Margin: Quidel's gross profit margin has decreased from 81.17% in December 2020 to 46.23% in December 2024. This indicates a decrease in the percentage of revenue remaining after deducting the cost of goods sold.
2. Operating Profit Margin: The operating profit margin has also decreased significantly, turning negative at -70.46% in December 2024 from 63.81% in December 2020. This suggests that the company's operating expenses and costs have outpaced its operating income.
3. Pretax Margin: Quidel's pretax margin declined from 62.61% in December 2020 to -76.59% in December 2024. This indicates that the company's pre-tax profitability has deteriorated, and it may be experiencing losses before tax in the most recent year.
4. Net Profit Margin: The net profit margin reflects Quidel's bottom-line profitability, which plummeted from 48.76% in December 2020 to -72.84% in December 2024. This sharp decline indicates that the company's net income as a percentage of revenue has turned negative, resulting in significant losses.
Overall, the declining trend in these profitability ratios raises concerns about Quidel Corporation's ability to generate profits efficiently and sustainably. Management may need to investigate and address the factors contributing to the deteriorating profitability to improve the company's financial performance.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -30.53% | 2.88% | 9.53% | 37.28% | 56.67% |
| Return on assets (ROA) | -31.56% | -0.12% | 6.20% | 28.98% | 43.30% |
| Return on total capital | -65.11% | 14.05% | 16.41% | 46.70% | 78.16% |
| Return on equity (ROE) | -67.92% | -0.20% | 11.12% | 36.50% | 60.80% |
Based on the provided data, Quidel Corporation's profitability ratios have shown a declining trend over the years:
1. Operating return on assets (Operating ROA):
- In December 31, 2020, the Operating ROA was a robust 56.67%, indicating efficient utilization of assets to generate operating income.
- However, this ratio has decreased to 37.28% by December 31, 2021, and further dropped to 9.53% by December 31, 2022, and even lower to 2.88% by December 31, 2023.
- By December 31, 2024, the Operating ROA drastically turned negative at -30.53%, suggesting that the operating income generated was insufficient to cover the asset base.
2. Return on assets (ROA):
- The return on assets was 43.30% on December 31, 2020, indicating a strong profitability level.
- However, this ratio has also followed a declining trend, reaching 28.98% by December 31, 2021, and further decreasing to 6.20% by December 31, 2022.
- The ROA then turned negative at -0.12% by December 31, 2023, and even lower at -31.56% by December 31, 2024, indicating that net income generated was insufficient to cover total assets in those years.
3. Return on total capital:
- The return on total capital was high at 78.16% on December 31, 2020, suggesting effective use of both debt and equity to generate returns.
- However, this ratio also declined significantly, dropping to 46.70% by December 31, 2021, and further to 16.41% by December 31, 2022, indicating a decrease in profitability relative to the total capital employed.
- By December 31, 2024, the return on total capital turned highly negative at -65.11%, which indicates inefficiency in generating returns on the total capital employed.
4. Return on equity (ROE):
- The return on equity started at a solid 60.80% on December 31, 2020, illustrating a high return to common shareholders' equity.
- However, the ROE decreased to 36.50% by December 31, 2021, and further dropped to 11.12% by December 31, 2022, indicating a decreasing profitability trend relative to shareholders' equity.
- By December 31, 2024, the ROE turned highly negative at -67.92%, showing that the company was not efficiently using equity to generate returns for shareholders.
In summary, the trend in Quidel Corporation's profitability ratios indicates a decline in profitability over the years, with a significant drop in returns on assets, total capital, and equity. This declining trend raises concerns about the company's ability to generate sufficient profits relative to the resources it employs.