Sprouts Farmers Market LLC (SFM)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 38.11% | 36.88% | 36.67% | 36.22% | 36.78% |
| Operating profit margin | 6.54% | 5.12% | 5.60% | 5.48% | 6.05% |
| Pretax margin | 6.56% | 5.03% | 5.45% | 5.29% | 5.83% |
| Net profit margin | 4.93% | 3.79% | 4.08% | 4.00% | 4.44% |
Based on the provided data, we can analyze the profitability ratios of Sprouts Farmers Market LLC as follows:
1. Gross Profit Margin:
- The gross profit margin for Sprouts Farmers Market has shown a slight fluctuation over the years, ranging from 36.22% to 38.11%. This indicates the percentage of revenue retained after deducting the cost of goods sold. The company has been able to maintain a relatively stable gross profit margin, which is positive for its profitability.
2. Operating Profit Margin:
- Sprouts Farmers Market's operating profit margin has fluctuated between 5.12% to 6.54% over the years. This ratio reflects the company's ability to generate profits from its core operations after accounting for operating expenses. The increase in operating profit margin in 2024 signals improved efficiency in managing operating costs.
3. Pretax Margin:
- The pretax margin for Sprouts Farmers Market has also varied from 5.03% to 6.56% during the period analyzed. This ratio shows the percentage of revenue that remains as profit before taxes are deducted. The upward trend in pretax margin from 2020 to 2024 suggests the company's improving profitability and cost management.
4. Net Profit Margin:
- Sprouts Farmers Market's net profit margin has ranged from 3.79% to 4.93% over the years. This metric indicates the percentage of revenue that translates into net income after all expenses have been deducted. The increase in net profit margin in 2024 reflects the company's ability to generate higher profits relative to its revenue.
In summary, while Sprouts Farmers Market has experienced some fluctuations in its profitability ratios, the overall trend suggests a relatively stable and improving financial performance. The company's ability to maintain and increase its profit margins indicates efficient cost management and potentially healthier financial performance in recent years.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 13.86% | 10.53% | 11.67% | 11.43% | 13.96% |
| Return on assets (ROA) | 10.45% | 7.78% | 8.51% | 8.35% | 10.24% |
| Return on total capital | 38.71% | 30.49% | 34.44% | 34.80% | 44.44% |
| Return on equity (ROE) | 28.79% | 22.54% | 24.96% | 25.44% | 32.62% |
Sprouts Farmers Market LLC's profitability ratios demonstrate some fluctuations over the years under consideration.
- Operating Return on Assets (Operating ROA): This ratio measures the efficiency of the company in generating operating profits from its assets. Sprouts Farmers Market's Operating ROA decreased from 13.96% in 2020 to 11.43% in 2021, then slightly rose to 11.67% in 2022, and finally declined to 10.53% in 2023 before increasing to 13.86% in 2024. This indicates some variability in the company's ability to generate operating income from its assets.
- Return on Assets (ROA): ROA indicates how efficiently the company is using its assets to generate profit. Sprouts Farmers Market's ROA followed a similar trend to Operating ROA, starting at 10.24% in 2020, decreasing to 8.35% in 2021, then slightly increasing to 8.51% in 2022, dropping to 7.78% in 2023, and finally rising to 10.45% in 2024. These fluctuations suggest changes in the company's profitability relative to its total assets.
- Return on Total Capital: This ratio evaluates the return generated from all the capital invested in the company. Sprouts Farmers Market's Return on Total Capital decreased from 44.44% in 2020 to 34.80% in 2021, then slightly decreased further to 34.44% in 2022, dropped to 30.49% in 2023, and finally improved to 38.71% in 2024. This indicates the company's ability to generate returns considering all forms of capital.
- Return on Equity (ROE): ROE measures the return on shareholder equity. Sprouts Farmers Market's ROE declined from 32.62% in 2020 to 25.44% in 2021, then slightly decreased further to 24.96% in 2022, dropped to 22.54% in 2023, and finally increased to 28.79% in 2024. This indicates the changes in profitability concerning shareholder equity over the years analyzed.
Overall, the profitability ratios of Sprouts Farmers Market LLC show some fluctuations year on year, suggesting changes in the efficiency of the company in utilizing its assets and capital to generate profits for its shareholders. An in-depth analysis of the company's financial performance and strategic decisions would be needed to understand the reasons behind these fluctuations.