UnitedHealth Group Incorporated (UNH)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 22.33% | 23.64% | 24.09% | 23.60% | 25.62% |
| Operating profit margin | 8.07% | 8.80% | 8.83% | 8.40% | 8.76% |
| Pretax margin | 5.01% | 7.92% | 8.18% | 7.82% | 8.11% |
| Net profit margin | 3.60% | 6.09% | 6.25% | 6.06% | 6.03% |
UnitedHealth Group's profitability ratios show a mixed performance over the past five years. The gross profit margin has fluctuated between 22.33% and 25.62%, with a slight decrease from 2020 to 2024. This indicates a decline in the percentage of revenue retained after deducting the cost of goods sold.
Similarly, the operating profit margin has ranged from 8.07% to 8.83%, remaining relatively stable overall. This margin measures the company's efficiency in generating profits from its core operations.
The pretax margin has shown more variability, decreasing from 8.11% in 2020 to 5.01% in 2024. This ratio reflects the percentage of revenue remaining after accounting for all operating expenses and before taxes are deducted.
The net profit margin has also experienced a notable decrease from 6.03% in 2020 to 3.60% in 2024. This ratio indicates the company's bottom-line profitability after all expenses, including taxes, have been accounted for.
Overall, UnitedHealth Group's profitability ratios suggest some challenges in maintaining profit margins, particularly in the most recent year. Further analysis of cost management and revenue-generation strategies may be needed to improve overall profitability in the future.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.82% | 11.82% | 11.57% | 11.30% | 11.36% |
| Return on assets (ROA) | 4.83% | 8.18% | 8.19% | 8.15% | 7.81% |
| Return on total capital | 6.12% | 32.16% | 36.56% | 33.40% | 34.21% |
| Return on equity (ROE) | 15.55% | 25.22% | 25.87% | 24.09% | 23.52% |
Based on the provided data, let's analyze the profitability ratios of UnitedHealth Group Incorporated:
1. Operating Return on Assets (Operating ROA):
- UnitedHealth Group's Operating ROA has remained relatively stable over the years, ranging from 11.30% to 11.82%. This indicates that the company effectively generates operating profits relative to its total assets.
2. Return on Assets (ROA):
- The ROA for UnitedHealth Group has shown a slight increase from 7.81% in 2020 to 8.18% in 2023, but then dropped to 4.83% in 2024. This ratio signifies the company's ability to generate profits from its assets. However, the declining trend in 2024 suggests a potential decrease in asset efficiency.
3. Return on Total Capital:
- UnitedHealth Group's Return on Total Capital demonstrates a significant decline from 34.21% in 2020 to 6.12% in 2024. This may indicate a decrease in the company's ability to generate returns from its total capital, which includes both debt and equity.
4. Return on Equity (ROE):
- The ROE of UnitedHealth Group has also exhibited a downward trend, decreasing from 23.52% in 2020 to 15.55% in 2024. A declining ROE suggests that the company's profitability in relation to shareholders' equity has been diminishing.
In summary, while UnitedHealth Group's Operating ROA remained stable, the company's overall profitability ratios, including ROA, Return on Total Capital, and ROE, have shown a declining trend over the years. This indicates a potential decrease in the company's efficiency in generating profits from its assets, capital, and equity.