Vital Energy Inc. (VTLE)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 59.89% | 70.95% | 60.02% | -83.20% | -13.64% |
| Operating profit margin | 37.53% | 70.89% | 86.88% | -130.33% | -47.75% |
| Pretax margin | 34.32% | 42.60% | 18.11% | -132.78% | -40.33% |
| Net profit margin | 46.61% | 42.23% | 17.67% | -132.18% | -40.02% |
Vital Energy Inc.'s profitability ratios displayed fluctuations over the past five years, indicating varying levels of efficiency in generating profits.
1. Gross profit margin: The gross profit margin reflects the efficiency of Vital Energy in managing its production costs. The company witnessed a substantial decline in 2020 due to a negative gross profit margin, which improved significantly in subsequent years but remained below the levels seen in 2019 and 2022.
2. Operating profit margin: The operating profit margin indicates the proportion of revenue that translates into operating income. Vital Energy experienced a sharp decline in 2020, with a negative operating profit margin, but showed a notable recovery in the following years, particularly in 2022 and 2023.
3. Pretax margin: The pretax margin measures the company's ability to generate profits before taxes relative to its total revenue. Vital Energy faced significant challenges in profitability in 2020, with a negative pretax margin, followed by improvements in the subsequent years, notably in 2021, 2022, and 2023.
4. Net profit margin: The net profit margin indicates the percentage of revenue that translates into net income. Vital Energy reported negative net profit margins in 2020, indicating significant losses, but managed to recover and achieve positive margins in the following years, with notable improvements in profitability in 2023.
Overall, Vital Energy Inc. displayed a mixed performance in profitability ratios over the five-year period, with significant improvements in the recent years following challenges in 2020. The company's focus should be on sustaining and enhancing profitability levels to ensure long-term financial stability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.87% | 38.89% | 27.94% | -59.75% | -18.04% |
| Return on assets (ROA) | 13.50% | 23.17% | 5.68% | -60.60% | -15.12% |
| Return on total capital | 15.05% | 34.27% | 13.51% | -66.77% | -14.09% |
| Return on equity (ROE) | 24.96% | 56.85% | 28.22% | — | -40.68% |
Vital Energy Inc.'s profitability ratios exhibit fluctuations over the past five years.
1. Operating return on assets (Operating ROA) has also varied significantly, ranging from -59.75% in 2020 to 38.89% in 2022, with a notable decrease to 10.87% in 2023.
2. Return on assets (ROA) indicates the firm's ability to generate profits from its assets. Vital Energy Inc.'s ROA has shown a mixed performance, with a low of -60.60% in 2020 and a high of 23.17% in 2022, improving further to 13.50% in 2023.
3. Return on total capital reflects the efficiency of the company in generating returns from both equity and debt. The trend in this ratio has been erratic, with a low of -66.77% in 2020, a peak of 34.27% in 2022, and a decrease to 15.05% in 2023.
4. Return on equity (ROE) demonstrates the company's ability to generate profit from shareholders' equity. Vital Energy Inc.'s ROE has been positive except for a significant decline to -40.68% in 2019. The ratio improved over the years, reaching 56.85% in 2022 and further increasing to 24.96% in 2023.
In conclusion, Vital Energy Inc.'s profitability ratios have seen fluctuations, which may reflect changes in the company's operating performance and financial structure over the years. It is crucial for the company to maintain positive trends in these ratios to ensure sustainable profitability and shareholder value creation.