AmerisourceBergen Corp. (NYSE:ABC)

Return on Assets (ROA)

Over the period analyzed, the Return on Assets demonstrates significant volatility. Initially, the ROA increased notably from 1.03% in 2017 to a peak of 4.4% in 2018, indicating improved asset efficiency in generating profits. However, this was followed by a decline to 2.18% in 2019, and a substantial downturn to negative territory at -7.7% in 2020, suggesting operational or asset utilization challenges during that year. The subsequent recovery to 2.69% in 2021 and 3% in 2022 reflects a gradual return to positive asset returns, although the values remain below the earlier peak.

Financial Leverage

Financial leverage ratios show considerable fluctuation and gaps in data. From 17.11 in 2017, leverage decreased to 12.84 in 2018 and slightly increased to 13.61 in 2019, suggesting a moderate use of debt relative to equity. Data for 2020 is missing, followed by an extraordinary spike to 256.71 in 2021, which indicates an extreme increase in leverage possibly due to substantial debt accumulation or restructuring activities during that year. Data for 2022 is unavailable, preventing further trend analysis for that period.

Return on Equity (ROE)

The Return on Equity exhibits a dramatic and irregular pattern. It rose sharply from 17.66% in 2017 to an exceptionally high 56.55% in 2018, evidencing highly profitable equity use. This was succeeded by a reduction to 29.71% in 2019. The absence of data for 2020 limits analysis for that year. In 2021, ROE escalated drastically to 689.46%, an exceptionally large increase that is likely influenced by the extraordinary surge in financial leverage observed in the same period. Such volatility suggests significant changes in equity returns tied closely to financing decisions during this period.

Net Profit Margin

The net profit margin exhibited substantial fluctuations over the observed period. Starting at a low 0.24% in 2017, the margin increased sharply to 0.99% in 2018, followed by a decline to 0.48% in 2019. A significant downturn occurred in 2020 with a negative margin of -1.8%, indicating a loss during that year. Recovery was observed in 2021 and 2022, with margins returning to positive values around 0.72% and 0.71%, respectively. Overall, the margin shows volatility with a notable dip in 2020 and partial rebound in subsequent years.

Asset Turnover

The asset turnover ratio showed a generally positive trend with some variability. It began at 4.34 in 2017 and gradually increased to 4.58 by 2019, suggesting improving efficiency in using assets to generate revenue. A decline was evident in 2020 and 2021, dropping to 4.29 and 3.73 respectively, signaling reduced asset utilization during this period. By 2022, there was a recovery to 4.22, although it did not reach the prior peak levels. The pattern indicates sensitivity to operational conditions affecting asset efficiency.

Financial Leverage

Financial leverage showed irregular data, with a decrease from 17.11 in 2017 to 12.84 in 2018, a slight rise in 2019 to 13.61, and missing data for 2020. An extreme spike to 256.71 was observed in 2021, which is a significant anomaly compared to prior years, followed by missing data in 2022. This exceptional increase may indicate a substantial change in financing structure or data reporting irregularities during 2021.

Return on Equity (ROE)

Return on equity showed a strong but inconsistent trajectory. ROE started at 17.66% in 2017 and more than tripled to 56.55% in 2018, but then fell to 29.71% in 2019. Data for 2020 is missing. In 2021, a dramatic increase to 689.46% is recorded, which is an outlier and inconsistent with previous trends, suggesting atypical financial events or accounting changes. The 2022 data is unavailable for this metric. This volatility implies significant irregularities or extraordinary items affecting equity returns in some years.

Tax Burden

The tax burden ratio exhibits fluctuations over the observed periods. It started at 0.40 in 2017, increased sharply to 1.36 in 2018, then decreased to 0.88 in 2019. There is missing data for 2020, but the ratio falls to 0.69 in 2021 before slightly rising to 0.77 in 2022. Overall, the ratio shows variability with no clear trend, indicating potential changes in tax expense relative to pre-tax earnings.

Interest Burden

This ratio is relatively stable over the years with values between 0.83 and 0.92, except for missing data in 2020. Beginning at 0.86 in 2017, it increased to 0.87 in 2018, dipped to 0.83 in 2019, and then rose again to approximately 0.91-0.92 in 2021 and 2022. This stability suggests consistent interest expense impact relative to EBIT.

EBIT Margin

The EBIT margin shows considerable volatility. Starting at a modest 0.7% in 2017, it slightly increased to 0.84% in 2018, then declined to 0.65% in 2019. A notable drop occurred in 2020, resulting in a negative margin of -2.71%, reflecting an operating loss during that year. The margin recovered in 2021 and 2022 to 1.12% and 1.03%, respectively, indicating operational improvement but still relatively low profitability.

Asset Turnover

Asset turnover demonstrates a generally declining trend with some recovery toward the end of the period. It rose gradually from 4.34 in 2017 to 4.58 in 2019, then decreased to 4.29 in 2020 and more sharply to 3.73 in 2021. There is partial recovery to 4.22 in 2022. This suggests a reduction in efficiency in using assets to generate sales, particularly after 2019, with signs of improvement in the most recent period.

Financial Leverage

Financial leverage recorded a major fluctuation. It declined from a high 17.11 in 2017 to 12.84 in 2018, then rose slightly to 13.61 in 2019. Data for 2020 is missing, but an extraordinary spike is seen in 2021 reaching 256.71, which is an outlier and likely indicates an unusual event or data anomaly. Data for 2022 is missing. The high leverage in 2021 could imply significant borrowing or equity changes during that year, warranting further investigation.

Return on Equity (ROE)

ROE displays extreme volatility and is heavily influenced by the abnormal leverage in 2021. It started at 17.66% in 2017 and surged dramatically to 56.55% in 2018, then decreased to 29.71% in 2019. No data for 2020 is available. A striking increase to 689.46% occurs in 2021, coinciding with the abnormal financial leverage, followed by missing data in 2022. The extreme 2021 figure suggests atypical financial conditions significantly affecting equity returns.

The financial data reveals several noteworthy trends spanning from 2017 to 2022, particularly in net profit margin, asset turnover, and return on assets (ROA).

Net Profit Margin

The net profit margin experienced considerable volatility over the period. Starting from a modest 0.24% in 2017, it surged to nearly 1% in 2018 before declining to 0.48% in 2019. A sharp downturn was observed in 2020, with the margin dropping to -1.8%, indicating a loss during that fiscal year. Subsequently, the margin recovered to positive territory with 0.72% in 2021 and maintained a similar level of 0.71% in 2022. This pattern suggests a period of financial difficulty in 2020 followed by stabilization and recovery in profitability.

Asset Turnover

Asset turnover exhibited a generally declining trend from 2017 through 2021, beginning at 4.34 times in 2017 and peaking slightly at 4.58 times in 2019. Thereafter, it declined to 4.29 in 2020 and further to its lowest point of 3.73 in 2021. In 2022, the asset turnover recovered somewhat to 4.22 times. This fluctuation suggests variability in the efficiency with which the company utilized its assets to generate sales, with a notable dip in 2021 but signs of improvement in the latest year.

Return on Assets (ROA)

The ROA similarly displayed pronounced fluctuations. It commenced at 1.03% in 2017 and rose substantially to 4.4% in 2018, then declined to 2.18% in 2019. A significant negative ROA of -7.7% was recorded in 2020, indicating considerable losses relative to asset base during that year. However, the ROA rebounded to 2.69% in 2021 and improved further to 3% in 2022, reflecting recovery and growing efficiency in asset use to generate profits.

Overall, the data indicates that 2020 was a challenging year marked by negative profitability and asset returns, while the subsequent years show a clear trend towards recovery and improved operational performance. Variations in asset turnover point to changes in asset utilization, which may have influenced profitability and returns. The company appears to have regained stability by 2022, as evidenced by positive margins and improving returns.

Tax Burden

The tax burden ratio exhibited considerable volatility over the period, starting at 0.4 in 2017 and peaking at 1.36 in 2018. After a decline to 0.88 in 2019, the ratio data for 2020 is missing, before resuming a downward trend to 0.69 in 2021 and slightly increasing to 0.77 in 2022. This fluctuation indicates variability in the effective tax rate impacting net income over these years.

Interest Burden

This ratio remained relatively stable across the periods, fluctuating modestly between 0.83 and 0.92. The data for 2020 is missing, but the ratios before and after suggest consistent interest expense management relative to earnings before interest and taxes.

EBIT Margin

The EBIT margin showed a mixed trend, beginning with a modest margin of 0.7% in 2017, peaking at 0.84% in 2018, and then declining to 0.65% in 2019. There was a sharp negative margin in 2020 at -2.71%, likely reflective of extraordinary operational challenges. This was followed by recovery with positive margins of 1.12% in 2021 and 1.03% in 2022, although not reaching the earlier peak levels.

Asset Turnover

Asset turnover, measuring efficiency in using assets to generate sales, showed a gradual increase from 4.34 in 2017 to a peak at 4.58 in 2019. However, it declined noticeably to 3.73 in 2021 before partially rebounding to 4.22 in 2022. This pattern suggests fluctuating effectiveness in asset utilization, especially during the pandemic-affected years.

Return on Assets (ROA)

ROA experienced significant variability, rising sharply from 1.03% in 2017 to 4.4% in 2018, then dropping to 2.18% in 2019. In 2020, ROA declined drastically to -7.7%, aligning with the negative EBIT margin and indicating operational losses. The subsequent years saw recovery to 2.69% in 2021 and 3% in 2022, though still below the 2018 peak.

Tax Burden

The tax burden ratio exhibited volatility across the reported periods. Initially at 0.40 in 2017, it increased sharply to 1.36 in 2018, then declined to 0.88 in 2019. Data for 2020 is missing. Subsequently, the ratio decreased to 0.69 in 2021 and slightly increased to 0.77 in 2022. This pattern demonstrates fluctuations in the company's effective tax rate or tax impact on earnings, with notable instability especially in the earlier years.

Interest Burden

The interest burden ratio remained relatively stable over the available periods. Starting from 0.86 in 2017, it showed a marginal increase to 0.87 in 2018, followed by a minor decline to 0.83 in 2019. The 2020 value is missing. Then it increased again to 0.92 in 2021 and slightly decreased to 0.91 in 2022. This stability indicates consistent interest expenses relative to earnings before interest and taxes.

EBIT Margin

The EBIT margin showed variability with a general downward trend during the mid-period. Beginning at 0.7% in 2017, it increased to 0.84% in 2018 but dropped to 0.65% in 2019. There was a significant deterioration in 2020, reaching a negative margin of -2.71%. This was followed by recovery to positive margins of 1.12% in 2021 and 1.03% in 2022, though both remained relatively low. The sharp negative margin in 2020 suggests operational difficulties or extraordinary expenses impacting earnings before interest and taxes in that year.

Net Profit Margin

The net profit margin mirrored the EBIT margin trends but with generally lower percentages. From a low of 0.24% in 2017, the margin improved to 0.99% in 2018 before falling to 0.48% in 2019. There was a significant decline in 2020, with the margin falling to -1.8%, indicating overall net losses. Recovery is seen in 2021 and 2022, with margins returning to positive but modest levels at 0.72% and 0.71%, respectively. This pattern underscores a period of profitability challenges around 2020, followed by partial recovery.