Stock Analysis on Net
Stock Analysis on Net

National Oilwell Varco Inc. (NYSE:NOV)

This company has been moved to the archive! The financial data has not been updated since August 3, 2016.

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

National Oilwell Varco Inc., decomposition of ROE

Microsoft Excel
ROE = ROA × Financial Leverage
Dec 31, 2015 -4.69% = -2.88% × 1.63
Dec 31, 2014 12.09% = 7.45% × 1.62
Dec 31, 2013 10.47% = 6.68% × 1.57
Dec 31, 2012 12.31% = 7.91% × 1.56
Dec 31, 2011 11.32% = 7.82% × 1.45

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

The primary reason for the decrease in return on equity ratio (ROE) over 2015 year is the decrease in profitability measured by return on assets ratio (ROA).

Three-Component Disaggregation of ROE

National Oilwell Varco Inc., decomposition of ROE

Microsoft Excel
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Dec 31, 2015 -4.69% = -5.21% × 0.55 × 1.63
Dec 31, 2014 12.09% = 11.67% × 0.64 × 1.62
Dec 31, 2013 10.47% = 10.18% × 0.66 × 1.57
Dec 31, 2012 12.31% = 12.43% × 0.64 × 1.56
Dec 31, 2011 11.32% = 13.60% × 0.57 × 1.45

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

The primary reason for the decrease in return on equity ratio (ROE) over 2015 year is the decrease in profitability measured by net profit margin ratio.

Five-Component Disaggregation of ROE

National Oilwell Varco Inc., decomposition of ROE

Microsoft Excel
ROE = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover × Financial Leverage
Dec 31, 2015 -4.69% = — × — × -3.31% × 0.55 × 1.63
Dec 31, 2014 12.09% = 0.71 × 0.97 × 17.01% × 0.64 × 1.62
Dec 31, 2013 10.47% = 0.70 × 0.97 × 15.11% × 0.66 × 1.57
Dec 31, 2012 12.31% = 0.71 × 0.99 × 17.77% × 0.64 × 1.56
Dec 31, 2011 11.32% = 0.68 × 0.99 × 20.27% × 0.57 × 1.45

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Two-Component Disaggregation of ROA

National Oilwell Varco Inc., decomposition of ROA

Microsoft Excel
ROA = Net Profit Margin × Asset Turnover
Dec 31, 2015 -2.88% = -5.21% × 0.55
Dec 31, 2014 7.45% = 11.67% × 0.64
Dec 31, 2013 6.68% = 10.18% × 0.66
Dec 31, 2012 7.91% = 12.43% × 0.64
Dec 31, 2011 7.82% = 13.60% × 0.57

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

The primary reason for the decrease in return on assets ratio (ROA) over 2015 year is the decrease in profitability measured by net profit margin ratio.

Four-Component Disaggregation of ROA

National Oilwell Varco Inc., decomposition of ROA

Microsoft Excel
ROA = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover
Dec 31, 2015 -2.88% = — × — × -3.31% × 0.55
Dec 31, 2014 7.45% = 0.71 × 0.97 × 17.01% × 0.64
Dec 31, 2013 6.68% = 0.70 × 0.97 × 15.11% × 0.66
Dec 31, 2012 7.91% = 0.71 × 0.99 × 17.77% × 0.64
Dec 31, 2011 7.82% = 0.68 × 0.99 × 20.27% × 0.57

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Disaggregation of Net Profit Margin

National Oilwell Varco Inc., decomposition of net profit margin ratio

Microsoft Excel
Net Profit Margin = Tax Burden × Interest Burden × EBIT Margin
Dec 31, 2015 -5.21% = — × — × -3.31%
Dec 31, 2014 11.67% = 0.71 × 0.97 × 17.01%
Dec 31, 2013 10.18% = 0.70 × 0.97 × 15.11%
Dec 31, 2012 12.43% = 0.71 × 0.99 × 17.77%
Dec 31, 2011 13.60% = 0.68 × 0.99 × 20.27%

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).