Steel Dynamics Inc (STLD)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 21.61% | 27.48% | 29.13% | 14.94% | 14.63% |
| Operating profit margin | 16.83% | 22.87% | 23.36% | 8.82% | 9.43% |
| Pretax margin | 17.11% | 22.48% | 22.69% | 7.14% | 8.30% |
| Net profit margin | 13.09% | 17.35% | 17.46% | 5.74% | 6.41% |
Steel Dynamics Inc.'s profitability ratios have shown some fluctuation over the past five years.
1. Gross Profit Margin: The company's gross profit margin has ranged from 14.63% in 2019 to 29.13% in 2021. This ratio indicates the efficiency of the company's production process and pricing strategy in generating profits after accounting for the cost of goods sold. The downward trend from 2021 to 2023 may suggest increased production costs or competitive pricing pressure.
2. Operating Profit Margin: Steel Dynamics Inc.'s operating profit margin has ranged from 9.03% in 2020 to 22.87% in 2022. This ratio reflects the company's ability to control operating expenses while generating profits from its core operations. The significant fluctuations in this ratio could indicate changes in operating efficiency or cost management strategies over the years.
3. Pretax Margin: The company's pretax margin has varied from 7.35% in 2020 to 22.86% in 2021. This ratio represents the profitability of the company before accounting for taxes. The increasing trend from 2020 to 2021 suggests improved operational performance and cost control measures.
4. Net Profit Margin: Steel Dynamics Inc.'s net profit margin has ranged from 5.74% in 2020 to 17.46% in 2021. This ratio indicates the company's overall profitability after accounting for all expenses, including taxes. The fluctuation in this ratio reflects changes in operational efficiency, cost management, and tax strategies over the years.
Overall, Steel Dynamics Inc.'s profitability ratios demonstrate a mix of performance levels across different years, highlighting the company's ability to manage costs, generate profits, and adapt to changing market conditions. A detailed analysis of the underlying factors driving these ratios would provide additional insights into the company's financial health and operational effectiveness.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 21.14% | 35.96% | 34.32% | 9.14% | 11.92% |
| Return on assets (ROA) | 16.44% | 27.28% | 25.65% | 5.94% | 8.11% |
| Return on total capital | 28.57% | 45.69% | 46.18% | 11.51% | 14.68% |
| Return on equity (ROE) | 27.64% | 47.51% | 50.98% | 12.68% | 16.47% |
Steel Dynamics Inc. has demonstrated strong profitability over the years, as evidenced by its key profitability ratios.
1. Operating return on assets (Operating ROA) has remained relatively high and stable over the last five years, ranging from 9.35% in 2020 to 35.96% in 2022. The company generated significant operating income relative to its total assets during these periods, with a peak in 2022.
2. Return on assets (ROA) has shown a similar trend, with values ranging from 5.94% in 2020 to 27.28% in 2022. This ratio reflects the company's ability to generate profits from its assets, with a notable increase in 2022.
3. Return on total capital has consistently been high, indicating that Steel Dynamics efficiently utilizes its total capital to generate profits. The ratio ranged from 11.63% in 2020 to 45.71% in 2021, with a notable decrease in 2023 compared to the previous two years.
4. Return on equity (ROE) has been impressive, with values ranging from 12.68% in 2020 to 50.98% in 2021. This ratio signifies the company's ability to generate returns for its shareholders, with a substantial increase in 2021 compared to previous years.
Overall, Steel Dynamics Inc. has demonstrated strong profitability performance, with consistently high returns on assets, capital, and equity over the past five years. The company's ability to efficiently use its resources to generate profits indicates effective management and operational performance.