XPO Logistics Inc (XPO)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 49.83% | 20.38% | 28.13% | 87.31% | 53.23% |
| Operating profit margin | 5.66% | 4.88% | 4.33% | 1.57% | 5.25% |
| Pretax margin | 3.32% | 9.59% | 4.82% | 0.91% | 4.48% |
| Net profit margin | 2.44% | 8.63% | 4.67% | 1.78% | 3.92% |
The profitability ratios of XPO Inc have shown some fluctuation over the past five years. The gross profit margin, which indicates the proportion of revenue left after accounting for the cost of goods sold, has shown significant improvement, increasing from 30.15% in 2021 to 77.27% in 2023. This improvement suggests that the company has become more efficient in managing its production costs.
However, the operating profit margin, which reflects the company's ability to control its operating expenses, has fluctuated slightly over the years, with a slight decrease from 7.11% in 2022 to 7.01% in 2023. This indicates that XPO Inc may have faced challenges in managing its operating costs efficiently in the most recent year.
The pretax margin, representing the company's profitability before taxes, has also shown some variability, with a slight increase in 2023 compared to 2022. This could indicate that XPO Inc has been able to better manage its non-operating expenses or generate higher revenues relative to costs.
Lastly, the net profit margin, which reflects the company's profitability after all expenses have been deducted, has shown significant fluctuations, with a notable decrease from 8.63% in 2022 to 2.44% in 2023. This suggests that XPO Inc may have faced challenges in managing its non-operating expenses or experienced lower revenue growth relative to costs in the most recent year.
Overall, while XPO Inc has shown improvements in its gross profit margin, there are areas where the company may need to focus on improving cost controls to enhance its overall profitability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.85% | 6.01% | 3.58% | 0.60% | 3.97% |
| Return on assets (ROA) | 2.52% | 10.62% | 3.85% | 0.68% | 2.97% |
| Return on total capital | 9.24% | 25.11% | 12.00% | 4.58% | 9.43% |
| Return on equity (ROE) | 14.93% | 65.81% | 29.53% | 4.06% | 15.28% |
Based on the provided data on XPO Inc's profitability ratios, we can observe the following trends:
1. Operating Return on Assets (Operating ROA):
- The Operating ROA has fluctuated over the past five years, ranging from 2.42% in 2020 to 8.76% in 2022.
- In 2023, XPO Inc's Operating ROA was 7.25%, indicating that the company generated $0.0725 in operating income for every dollar of assets.
- Overall, the company has shown a reasonable level of operational efficiency in generating profits from its assets.
2. Return on Assets (ROA):
- The ROA has varied significantly, with a high of 10.62% in 2022 and a low of 0.49% in 2020.
- In 2023, the ROA stood at 2.52%, denoting that XPO Inc generated $0.0252 in net income for each dollar of assets.
- The company's ability to generate profits from its total assets has shown improvement compared to the prior year but remains relatively moderate.
3. Return on Total Capital:
- The Return on Total Capital has displayed fluctuations, reaching a peak of 15.49% in 2022 and a low of 4.15% in 2020.
- In 2023, XPO Inc achieved a Return on Total Capital of 11.63%, illustrating the return generated for both debt and equity holders.
- The company's performance in utilizing its total capital to generate profits demonstrates a satisfactory level of efficiency.
4. Return on Equity (ROE):
- The ROE has exhibited significant variability, with a high of 65.81% in 2022 and a low of 2.92% in 2020.
- In 2023, XPO Inc's ROE stood at 14.93%, signaling the return generated for shareholders' equity investment.
- The company's ability to generate returns for its equity investors has shown improvement compared to the previous year but remains relatively moderate in comparison to historical highs.
In conclusion, XPO Inc has shown mixed performance in terms of profitability ratios over the past five years, with varying levels of efficiency in generating returns from assets, total capital, and equity. Continued monitoring and analysis of these ratios will be crucial to assess the company's financial health and performance over time.