Stock Analysis on Net
Stock Analysis on Net

Linde plc (NASDAQ:LIN)

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
Quarterly Data

Microsoft Excel

Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.

Two-Component Disaggregation of ROE

Linde plc, decomposition of ROE (quarterly data)

Microsoft Excel
ROE = ROA × Financial Leverage
Sep 30, 2024 16.29% = 7.73% × 2.11
Jun 30, 2024 16.76% = 7.98% × 2.10
Mar 31, 2024 16.25% = 7.85% × 2.07
Dec 31, 2023 15.61% = 7.67% × 2.03
Sep 30, 2023 15.38% = 7.69% × 2.00
Jun 30, 2023 14.26% = 7.23% × 1.97
Mar 31, 2023 11.23% = 5.59% × 2.01
Dec 31, 2022 10.36% = 5.21% × 1.99
Sep 30, 2022 10.22% = 5.17% × 1.98
Jun 30, 2022 8.95% = 4.56% × 1.96
Mar 31, 2022 9.36% = 4.86% × 1.93
Dec 31, 2021 8.69% = 4.69% × 1.85
Sep 30, 2021 8.05% = 4.24% × 1.90
Jun 30, 2021 7.19% = 3.90% × 1.84
Mar 31, 2021 6.29% = 3.42% × 1.84
Dec 31, 2020 5.29% = 2.83% × 1.86
Sep 30, 2020 4.86% = 2.57% × 1.89
Jun 30, 2020 5.00% = 2.65% × 1.89
Mar 31, 2020 5.23% = 2.77% × 1.88
Dec 31, 2019 4.66% = 2.64% × 1.76
Sep 30, 2019 — = — × 1.72
Jun 30, 2019 — = — × 1.72
Mar 31, 2019 — = — × 1.79

Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).

The primary reason for the decrease in return on equity ratio (ROE) over Q3 2024 is the decrease in profitability measured by return on assets ratio (ROA).

Three-Component Disaggregation of ROE

Linde plc, decomposition of ROE (quarterly data)

Microsoft Excel
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Sep 30, 2024 16.29% = 19.33% × 0.40 × 2.11
Jun 30, 2024 16.76% = 19.49% × 0.41 × 2.10
Mar 31, 2024 16.25% = 19.26% × 0.41 × 2.07
Dec 31, 2023 15.61% = 18.87% × 0.41 × 2.03
Sep 30, 2023 15.38% = 18.44% × 0.42 × 2.00
Jun 30, 2023 14.26% = 17.20% × 0.42 × 1.97
Mar 31, 2023 11.23% = 13.46% × 0.42 × 2.01
Dec 31, 2022 10.36% = 12.43% × 0.42 × 1.99
Sep 30, 2022 10.22% = 11.39% × 0.45 × 1.98
Jun 30, 2022 8.95% = 10.88% × 0.42 × 1.96
Mar 31, 2022 9.36% = 12.66% × 0.38 × 1.93
Dec 31, 2021 8.69% = 12.42% × 0.38 × 1.85
Sep 30, 2021 8.05% = 11.99% × 0.35 × 1.90
Jun 30, 2021 7.19% = 11.37% × 0.34 × 1.84
Mar 31, 2021 6.29% = 10.48% × 0.33 × 1.84
Dec 31, 2020 5.29% = 9.18% × 0.31 × 1.86
Sep 30, 2020 4.86% = 8.29% × 0.31 × 1.89
Jun 30, 2020 5.00% = 8.37% × 0.32 × 1.89
Mar 31, 2020 5.23% = 8.35% × 0.33 × 1.88
Dec 31, 2019 4.66% = 8.09% × 0.33 × 1.76
Sep 30, 2019 — = — × — × 1.72
Jun 30, 2019 — = — × — × 1.72
Mar 31, 2019 — = — × — × 1.79

Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).

The primary reason for the decrease in return on equity ratio (ROE) over Q3 2024 is the decrease in efficiency measured by asset turnover ratio.

Two-Component Disaggregation of ROA

Linde plc, decomposition of ROA (quarterly data)

Microsoft Excel
ROA = Net Profit Margin × Asset Turnover
Sep 30, 2024 7.73% = 19.33% × 0.40
Jun 30, 2024 7.98% = 19.49% × 0.41
Mar 31, 2024 7.85% = 19.26% × 0.41
Dec 31, 2023 7.67% = 18.87% × 0.41
Sep 30, 2023 7.69% = 18.44% × 0.42
Jun 30, 2023 7.23% = 17.20% × 0.42
Mar 31, 2023 5.59% = 13.46% × 0.42
Dec 31, 2022 5.21% = 12.43% × 0.42
Sep 30, 2022 5.17% = 11.39% × 0.45
Jun 30, 2022 4.56% = 10.88% × 0.42
Mar 31, 2022 4.86% = 12.66% × 0.38
Dec 31, 2021 4.69% = 12.42% × 0.38
Sep 30, 2021 4.24% = 11.99% × 0.35
Jun 30, 2021 3.90% = 11.37% × 0.34
Mar 31, 2021 3.42% = 10.48% × 0.33
Dec 31, 2020 2.83% = 9.18% × 0.31
Sep 30, 2020 2.57% = 8.29% × 0.31
Jun 30, 2020 2.65% = 8.37% × 0.32
Mar 31, 2020 2.77% = 8.35% × 0.33
Dec 31, 2019 2.64% = 8.09% × 0.33
Sep 30, 2019 — = — × —
Jun 30, 2019 — = — × —
Mar 31, 2019 — = — × —

Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).

The primary reason for the decrease in return on assets ratio (ROA) over Q3 2024 is the decrease in asset turnover ratio.