Thermo Fisher Scientific Inc (TMO)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 72.97% | 74.10% | 73.83% | 72.71% | 45.80% |
| Operating profit margin | 16.56% | 18.98% | 26.44% | 24.60% | 18.57% |
| Pretax margin | 15.16% | 17.30% | 23.29% | 22.80% | 16.46% |
| Net profit margin | 14.48% | 15.72% | 20.36% | 20.12% | 14.94% |
Thermo Fisher Scientific Inc.'s profitability ratios have shown a declining trend over the past five years. The gross profit margin decreased from 50.08% in 2021 to 39.90% in 2023. This indicates a decline in the company's ability to generate revenue after accounting for the cost of goods sold.
Similarly, the operating profit margin also demonstrated a decreasing trend, falling from 26.08% in 2021 to 17.08% in 2023. This suggests that the company's operational efficiency in generating profits from its core business activities has weakened over time.
The pretax margin, which reflects the company's profitability before accounting for taxes, also experienced a decline from 22.54% in 2021 to 14.56% in 2023. This indicates challenges in maintaining profitability at the operating level.
Furthermore, the net profit margin, representing the company's profitability after all expenses have been deducted, decreased from 19.70% in 2021 to 13.99% in 2023. This shows a reduction in the company's ability to convert revenue into net profit.
Overall, the declining profitability ratios of Thermo Fisher Scientific Inc. suggest potential challenges in its cost management, revenue generation, and operational efficiency, which may warrant further investigation into the company's financial performance and strategic initiatives.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 6.95% | 8.64% | 10.54% | 11.29% | 7.87% |
| Return on assets (ROA) | 6.07% | 7.15% | 8.12% | 9.23% | 6.33% |
| Return on total capital | 14.68% | 19.08% | 24.58% | 14.54% | 9.83% |
| Return on equity (ROE) | 12.83% | 15.80% | 18.94% | 18.47% | 12.45% |
Thermo Fisher Scientific Inc.'s profitability ratios demonstrate a gradual fluctuation over the past five years. The operating return on assets (Operating ROA) decreased from 11.43% in 2020 to 7.41% in 2023, indicating a decline in operating efficiency in generating profits from its assets.
The Return on Assets (ROA) exhibited a similar trend, decreasing from 9.23% in 2020 to 6.07% in 2023, suggesting a reduction in the company's ability to generate profits from its total assets.
On the other hand, the Return on Total Capital decreased from 14.03% in 2020 to 8.89% in 2023, indicating a decrease in profitability relative to the total capital employed by the company over the years.
The Return on Equity (ROE) also experienced a decline from 18.47% in 2020 to 12.83% in 2023, reflecting a diminishing ability to generate profits for the company's shareholders based on their equity investments in the firm.
Overall, Thermo Fisher Scientific Inc.'s profitability ratios suggest a general downward trend in profitability and efficiency in utilizing assets and capital to generate returns for shareholders over the past five years.