United Parcel Service Inc (UPS)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 35.73% | 40.32% | 42.34% | 37.79% | 37.08% |
| Operating profit margin | 10.14% | 13.13% | 13.27% | 9.15% | 10.62% |
| Pretax margin | 9.51% | 14.87% | 17.19% | 2.20% | 7.70% |
| Net profit margin | 7.44% | 11.58% | 13.35% | 1.60% | 6.05% |
The profitability ratios of United Parcel Service, Inc. have shown fluctuations over the past five years.
1. Gross profit margin has remained consistently at 100% throughout the period, indicating the company has been able to efficiently manage its production costs and maintain a high level of gross profit on its sales.
2. Operating profit margin decreased from 13.05% in 2022 to 10.05% in 2023, indicating a slight decline in the company's ability to generate profits from its core operations. However, the margin remained relatively stable over the years, suggesting efficiency in managing operating expenses.
3. Pretax margin fluctuated significantly, with a notable decrease in 2023 compared to the previous years. This indicates that the company's profitability before taxes has been impacted by various factors, such as changes in tax rates, operating efficiencies, and non-operating income.
4. Net profit margin has also shown fluctuations, with a decrease in 2023 compared to 2022. Despite this, the net profit margin has generally improved over the years, indicating the company's ability to generate profit after accounting for all expenses, including taxes.
Overall, while United Parcel Service, Inc. has maintained a strong gross profit margin, its operating profit margin has shown some decline, and the variability in pretax and net profit margins suggests that the company's profitability has been influenced by a mix of internal and external factors over the years.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 12.90% | 18.41% | 18.46% | 12.31% | 13.48% |
| Return on assets (ROA) | 9.47% | 16.24% | 18.57% | 2.15% | 7.67% |
| Return on total capital | 54.07% | 41.85% | 50.79% | 11.22% | 25.13% |
| Return on equity (ROE) | 38.76% | 58.36% | 90.44% | 204.41% | 135.90% |
- United Parcel Service, Inc.'s Operating Return on Assets (Operating ROA) has shown a downward trend over the past five years, decreasing from 18.46% in 2021 to 12.90% in 2023. This indicates that the company's operating income generated from its assets has decreased over this period.
- The overall Return on Assets (ROA) has also demonstrated variability, with a significant decrease in 2020 (2.15%) followed by a rebound in the subsequent years. The ROA stood at 9.47% as of December 31, 2023, suggesting that the company is generating a profit of 9.47% for every dollar of assets held.
- Return on Total Capital has shown fluctuations over the past five years, with a notable increase in 2023 to 23.10%. This ratio indicates that the company is making substantial returns on its total invested capital.
- Return on Equity (ROE) reflects a similar pattern as Return on Total Capital, exhibiting variability over the years. The ROE peaked at 204.41% in 2020 and has since decreased, reaching 38.76% as of December 31, 2023. This suggests that the company is generating a profit of 38.76% for every dollar of shareholder equity.
In conclusion, while the profitability ratios of United Parcel Service, Inc. have displayed fluctuations over the years, the company continues to generate positive returns for its assets, capital, and equity, albeit at varying levels.