Sylvamo Corp (SLVM)

Return on sales

Sylvamo Corp's profitability ratios reflect fluctuations over the past five years.

1. Gross Profit Margin: The gross profit margin shows the percentage of revenue that exceeds the cost of goods sold. Sylvamo's gross profit margin fluctuated from 30.18% in 2020 to a peak of 33.89% in 2021 before declining to 24.91% in 2024. This indicates the company's ability to manage production costs and pricing strategies.

2. Operating Profit Margin: The operating profit margin reveals the percentage of revenue remaining after deducting operating expenses. Sylvamo's operating profit margin increased from 6.45% in 2020 to 16.10% in 2023, showcasing efficient cost management. However, it decreased to 11.77% in 2024, suggesting potential challenges in controlling operational costs.

3. Pretax Margin: The pretax margin signifies the percentage of revenue that translates to pre-tax profits. Sylvamo experienced fluctuations in its pretax margin, from 6.58% in 2020 to 13.14% in 2021, but then dipped to 10.73% in 2024. This trend may reflect changes in tax liabilities and non-operational expenses impacting profitability.

4. Net Profit Margin: The net profit margin represents the percentage of revenue remaining as net income after all expenses are deducted. Sylvamo's net profit margin ranged from 5.65% in 2020 to 9.45% in 2021, with a slight decline to 8.00% in 2024. This indicates the company's ability to maintain profitability after considering all costs and taxes.

Overall, Sylvamo Corp's profitability ratios demonstrate a mix of strengths and potential challenges in managing costs, operational efficiency, and overall profitability over the five-year period.

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Return on investment

Sylvamo Corp's profitability has shown significant improvement over the period from December 31, 2020, to December 31, 2024, as indicated by its various profitability ratios.

1. Operating Return on Assets (Operating ROA):
- The Operating ROA has shown a positive trend, increasing from 6.66% in 2020 to 20.86% in 2023, and then slightly decreasing to 17.05% in 2024. This suggests that the company has been effectively utilizing its assets to generate operating profits.

2. Return on Assets (ROA):
- The ROA also exhibits an overall positive trend, starting at 5.84% in 2020, peaking at 12.75% in 2021, and then fluctuating slightly between 8.81% and 11.60% in subsequent years. This indicates that Sylvamo Corp has been generating satisfactory profits relative to its total assets.

3. Return on Total Capital:
- The Return on Total Capital ratio saw a substantial increase in 2021, reaching 197.25%, which may indicate a significant increase in the efficiency of capital utilization. Although the ratio has gradually decreased in the following years, it remained relatively high, ranging from 48.06% to 79.50%, reflecting the company's ability to generate returns on its total invested capital.

4. Return on Equity (ROE):
- The Return on Equity ratio also experienced a remarkable surge in 2021, reaching 181.87%, which signifies the enhanced profitability available to shareholders. While the ROE declined in the subsequent years, it remained at respectable levels, indicating efficient utilization of equity to generate profits.

Overall, Sylvamo Corp's profitability ratios demonstrate a positive performance, with a consistent or increasing trend in most ratios. This suggests that the company has been effective in generating profits from its assets, capital, and equity, showcasing its ability to create value for its stakeholders.