Stock Analysis on Net
Stock Analysis on Net

Tesla Inc. (NASDAQ:TSLA)

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

Microsoft Excel

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

Two-Component Disaggregation of ROE

Tesla Inc., decomposition of ROE

Microsoft Excel
ROE = ROA × Financial Leverage
Dec 31, 2023 23.94% = 14.07% × 1.70
Dec 31, 2022 28.09% = 15.25% × 1.84
Dec 31, 2021 18.28% = 8.88% × 2.06
Dec 31, 2020 3.24% = 1.38% × 2.35
Dec 31, 2019 -13.03% = -2.51% × 5.18

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the decrease in return on equity ratio (ROE) over 2023 year is the decrease in profitability measured by return on assets ratio (ROA).

Three-Component Disaggregation of ROE

Tesla Inc., decomposition of ROE

Microsoft Excel
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Dec 31, 2023 23.94% = 15.50% × 0.91 × 1.70
Dec 31, 2022 28.09% = 15.41% × 0.99 × 1.84
Dec 31, 2021 18.28% = 10.25% × 0.87 × 2.06
Dec 31, 2020 3.24% = 2.29% × 0.60 × 2.35
Dec 31, 2019 -13.03% = -3.51% × 0.72 × 5.18

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the decrease in return on equity ratio (ROE) over 2023 year is the decrease in efficiency measured by asset turnover ratio.

Five-Component Disaggregation of ROE

Tesla Inc., decomposition of ROE

Microsoft Excel
ROE = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover × Financial Leverage
Dec 31, 2023 23.94% = 1.50 × 0.98 × 10.49% × 0.91 × 1.70
Dec 31, 2022 28.09% = 0.92 × 0.99 × 17.04% × 0.99 × 1.84
Dec 31, 2021 18.28% = 0.89 × 0.94 × 12.24% × 0.87 × 2.06
Dec 31, 2020 3.24% = 0.71 × 0.58 × 5.58% × 0.60 × 2.35
Dec 31, 2019 -13.03% = — × — × -0.27% × 0.72 × 5.18

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the decrease in return on equity ratio (ROE) over 2023 year is the decrease in operating profitability measured by EBIT margin ratio.

Two-Component Disaggregation of ROA

Tesla Inc., decomposition of ROA

Microsoft Excel
ROA = Net Profit Margin × Asset Turnover
Dec 31, 2023 14.07% = 15.50% × 0.91
Dec 31, 2022 15.25% = 15.41% × 0.99
Dec 31, 2021 8.88% = 10.25% × 0.87
Dec 31, 2020 1.38% = 2.29% × 0.60
Dec 31, 2019 -2.51% = -3.51% × 0.72

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the decrease in return on assets ratio (ROA) over 2023 year is the decrease in asset turnover ratio.

Four-Component Disaggregation of ROA

Tesla Inc., decomposition of ROA

Microsoft Excel
ROA = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover
Dec 31, 2023 14.07% = 1.50 × 0.98 × 10.49% × 0.91
Dec 31, 2022 15.25% = 0.92 × 0.99 × 17.04% × 0.99
Dec 31, 2021 8.88% = 0.89 × 0.94 × 12.24% × 0.87
Dec 31, 2020 1.38% = 0.71 × 0.58 × 5.58% × 0.60
Dec 31, 2019 -2.51% = — × — × -0.27% × 0.72

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the decrease in return on assets ratio (ROA) over 2023 year is the decrease in operating profitability measured by EBIT margin ratio.

Disaggregation of Net Profit Margin

Tesla Inc., decomposition of net profit margin ratio

Microsoft Excel
Net Profit Margin = Tax Burden × Interest Burden × EBIT Margin
Dec 31, 2023 15.50% = 1.50 × 0.98 × 10.49%
Dec 31, 2022 15.41% = 0.92 × 0.99 × 17.04%
Dec 31, 2021 10.25% = 0.89 × 0.94 × 12.24%
Dec 31, 2020 2.29% = 0.71 × 0.58 × 5.58%
Dec 31, 2019 -3.51% = — × — × -0.27%

Based on: 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), 10-K (reporting date: 2019-12-31).

The primary reason for the increase in net profit margin ratio over 2023 year is the increase in effect of taxes measured by tax burden ratio.