Return on Capital (ROC)
Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company debt and equity structure. It measures business productivity performance.
Return on Invested Capital (ROIC)
Honeywell International Inc., ROIC calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | 5,978) | 5,956) | 5,460) | 5,961) | 5,376) | |
| Invested capital2 | 60,349) | 48,147) | 47,332) | 48,349) | 49,130) | |
| Performance Ratio | ||||||
| ROIC3 | 9.91% | 12.37% | 11.54% | 12.33% | 10.94% | |
| Benchmarks | ||||||
| ROIC, Competitors4 | ||||||
| Boeing Co. | -20.37% | -0.17% | -5.73% | -5.36% | -17.44% | |
| Caterpillar Inc. | 18.17% | 18.02% | 13.41% | 12.58% | 6.24% | |
| Eaton Corp. plc | — | 10.48% | 8.00% | 7.84% | 5.61% | |
| GE Aerospace | 20.07% | 20.95% | 2.73% | -2.53% | 5.22% | |
| Lockheed Martin Corp. | 18.98% | 25.46% | 21.60% | 22.51% | 25.67% | |
| RTX Corp. | 5.82% | 3.68% | 4.11% | 4.41% | -1.38% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Invested capital. See details »
3 2024 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 5,978 ÷ 60,349 = 9.91%
4 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| ROIC | A measure of the periodic, after tax, cash-on-cash yield earned in the business. | Honeywell International Inc. ROIC improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
Decomposition of ROIC
Honeywell International Inc., decomposition of ROIC
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
The primary reason for the decrease in return on invested capital (ROIC) over 2024 year is the decrease in efficiency measured by turnover of capital (TO) ratio.
Operating Profit Margin (OPM)
Honeywell International Inc., OPM calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | 5,978) | 5,956) | 5,460) | 5,961) | 5,376) | |
| Add: Cash operating taxes2 | 1,847) | 1,434) | 1,654) | 1,503) | 1,380) | |
| Net operating profit before taxes (NOPBT) | 7,825) | 7,390) | 7,114) | 7,464) | 6,756) | |
| Net sales | 38,498) | 36,662) | 35,466) | 34,392) | 32,637) | |
| Add: Increase (decrease) in customer advances and deferred income | 26) | (219) | 402) | 199) | 488) | |
| Adjusted net sales | 38,524) | 36,443) | 35,868) | 34,591) | 33,125) | |
| Profitability Ratio | ||||||
| OPM3 | 20.31% | 20.28% | 19.83% | 21.58% | 20.40% | |
| Benchmarks | ||||||
| OPM, Competitors4 | ||||||
| Boeing Co. | -14.62% | 0.85% | -3.49% | -3.17% | -20.02% | |
| Caterpillar Inc. | 22.35% | 20.95% | 17.42% | 19.09% | 11.64% | |
| Eaton Corp. plc | — | 17.76% | 14.81% | 15.90% | 11.40% | |
| GE Aerospace | 24.39% | 17.53% | 4.46% | -2.35% | 12.65% | |
| Lockheed Martin Corp. | 10.03% | 13.04% | 11.60% | 11.85% | 13.19% | |
| RTX Corp. | 10.06% | 7.71% | 10.88% | 9.65% | -1.08% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
OPM = 100 × NOPBT ÷ Adjusted net sales
= 100 × 7,825 ÷ 38,524 = 20.31%
4 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| OPM | The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. | Honeywell International Inc. OPM improved from 2022 to 2023 and from 2023 to 2024. |
Turnover of Capital (TO)
Honeywell International Inc., TO calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 38,498) | 36,662) | 35,466) | 34,392) | 32,637) | |
| Add: Increase (decrease) in customer advances and deferred income | 26) | (219) | 402) | 199) | 488) | |
| Adjusted net sales | 38,524) | 36,443) | 35,868) | 34,591) | 33,125) | |
| Invested capital1 | 60,349) | 48,147) | 47,332) | 48,349) | 49,130) | |
| Efficiency Ratio | ||||||
| TO2 | 0.64 | 0.76 | 0.76 | 0.72 | 0.67 | |
| Benchmarks | ||||||
| TO, Competitors3 | ||||||
| Boeing Co. | 1.32 | 1.73 | 1.31 | 1.26 | 1.22 | |
| Caterpillar Inc. | 1.07 | 1.15 | 1.03 | 0.87 | 0.72 | |
| Eaton Corp. plc | — | 0.74 | 0.67 | 0.67 | 0.65 | |
| GE Aerospace | 0.93 | 1.29 | 1.10 | 0.99 | 0.63 | |
| Lockheed Martin Corp. | 2.47 | 2.46 | 2.48 | 2.34 | 2.33 | |
| RTX Corp. | 0.73 | 0.62 | 0.59 | 0.56 | 0.49 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Invested capital. See details »
2 2024 Calculation
TO = Adjusted net sales ÷ Invested capital
= 38,524 ÷ 60,349 = 0.64
3 Click competitor name to see calculations.
| Efficiency ratio | Description | The company |
|---|---|---|
| TO | The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. | Honeywell International Inc. TO deteriorated from 2022 to 2023 and from 2023 to 2024. |
Effective Cash Tax Rate (CTR)
Honeywell International Inc., CTR calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | 5,978) | 5,956) | 5,460) | 5,961) | 5,376) | |
| Add: Cash operating taxes2 | 1,847) | 1,434) | 1,654) | 1,503) | 1,380) | |
| Net operating profit before taxes (NOPBT) | 7,825) | 7,390) | 7,114) | 7,464) | 6,756) | |
| Tax Rate | ||||||
| CTR3 | 23.60% | 19.41% | 23.25% | 20.13% | 20.43% | |
| Benchmarks | ||||||
| CTR, Competitors4 | ||||||
| Boeing Co. | — | 111.76% | — | — | — | |
| Caterpillar Inc. | 23.78% | 25.26% | 25.42% | 24.06% | 25.70% | |
| Eaton Corp. plc | — | 20.06% | 19.89% | 26.02% | 24.39% | |
| GE Aerospace | 11.67% | 7.01% | 44.47% | — | 34.06% | |
| Lockheed Martin Corp. | 23.33% | 20.72% | 24.95% | 18.89% | 16.51% | |
| RTX Corp. | 20.17% | 22.52% | 36.10% | 18.64% | — | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 1,847 ÷ 7,825 = 23.60%
4 Click competitor name to see calculations.
| Tax rate | Description | The company |
|---|---|---|
| CTR | Effective cash tax rate on operating income. | Honeywell International Inc. CTR decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level. |