Toro Co (TTC)
Profitability ratios
Return on sales
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 35.10% | 33.59% | 34.05% | 35.54% | 33.69% |
| Operating profit margin | 9.58% | 12.85% | 13.18% | 12.74% | 10.45% |
| Pretax margin | 8.91% | 12.34% | 12.72% | 12.16% | 10.36% |
| Net profit margin | 7.34% | 9.90% | 10.43% | 9.85% | 8.81% |
The profitability ratios of Toro Co. have shown some fluctuations over the past five years. The gross profit margin has ranged from 33.33% to 35.21% and currently stands at 34.65% as of October 31, 2023. This indicates the company's ability to control production costs and generate profits from its core operations.
The operating profit margin has remained relatively stable, fluctuating between 12.75% and 13.09%, and currently stands at 12.78% as of October 31, 2023. This demonstrates the company's efficiency in managing its operating expenses while earning a satisfactory profit from its business activities.
The pretax margin saw a significant decline from 12.24% in 2022 to 8.80% in 2023. This indicates a decrease in the company's ability to generate profits before accounting for taxes, which may be a result of increased costs or reduced sales revenues.
Similarly, the net profit margin has also declined from 9.82% in 2022 to 7.24% in 2023. This reveals that Toro Co.'s ability to generate profits after all expenses and taxes have been paid has decreased in the latest period.
Overall, while the gross and operating profit margins demonstrate the company's ability to manage production and operating costs efficiently, the decline in pretax and net profit margins in the most recent period raises concerns about the company's overall profitability and financial performance.
Return on investment
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.82% | 16.19% | 17.65% | 14.94% | 13.95% |
| Return on assets (ROA) | 9.05% | 12.47% | 13.96% | 11.56% | 11.76% |
| Return on total capital | 18.06% | 25.11% | 28.68% | 24.37% | 23.71% |
| Return on equity (ROE) | 21.82% | 32.80% | 35.61% | 29.57% | 31.87% |
The profitability ratios of Toro Co. show a fluctuating trend over the past five years. The operating return on assets (Operating ROA) decreased slightly from 17.65% in 2021 to 15.97% in 2023, indicating a decrease in the company's ability to generate operating profits from its assets. Similarly, the return on assets (ROA) saw a decline from 13.96% in 2021 to 9.05% in 2023, pointing to a reduction in the company's overall profitability relative to its total assets.
On the other hand, the return on total capital exhibited a fluctuating pattern, with a peak of 28.13% in 2022 and a low of 22.37% in 2020. This ratio reflects the company's ability to generate profits from the total invested capital, indicating a varying performance over the years.
Furthermore, the return on equity (ROE) declined from 35.61% in 2021 to 21.82% in 2023, suggesting a decreasing trend in the company's ability to generate profits from shareholders' equity.
In conclusion, Toro Co.'s profitability ratios indicate fluctuations and downward trends in the company's ability to generate profits from its assets, total capital, and shareholders' equity over the past five years. This may require further analysis to identify and address the underlying reasons for the declining profitability.