Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Sherwin-Williams Co., profitability ratios
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Sherwin-Williams Co. gross profit margin ratio improved from 2019 to 2020 but then deteriorated significantly from 2020 to 2021. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Sherwin-Williams Co. operating profit margin ratio improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021 not reaching 2019 level. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Sherwin-Williams Co. net profit margin ratio improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021 not reaching 2019 level. |
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Sherwin-Williams Co. ROE improved from 2019 to 2020 and from 2020 to 2021. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Sherwin-Williams Co. ROA improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021. |
Gross Profit Margin
Sherwin-Williams Co., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Gross profit | 8,542,700) | 8,682,600) | 8,036,100) | 7,418,562) | 6,781,211) | |
| Net sales | 19,944,600) | 18,361,700) | 17,900,800) | 17,534,493) | 14,983,788) | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 42.83% | 47.29% | 44.89% | 42.31% | 45.26% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Linde plc | 43.03% | 43.53% | 41.04% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Gross profit margin = 100 × Gross profit ÷ Net sales
= 100 × 8,542,700 ÷ 19,944,600 = 42.83%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Sherwin-Williams Co. gross profit margin ratio improved from 2019 to 2020 but then deteriorated significantly from 2020 to 2021. |
Operating Profit Margin
Sherwin-Williams Co., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Operating income | 2,558,900) | 2,861,300) | 2,287,200) | 1,877,548) | 1,766,145) | |
| Net sales | 19,944,600) | 18,361,700) | 17,900,800) | 17,534,493) | 14,983,788) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 12.83% | 15.58% | 12.78% | 10.71% | 11.79% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Linde plc | 16.19% | 12.19% | 10.39% | — | — | |
| Operating Profit Margin, Industry | ||||||
| Materials | 24.89% | 13.90% | 9.44% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Operating profit margin = 100 × Operating income ÷ Net sales
= 100 × 2,558,900 ÷ 19,944,600 = 12.83%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Sherwin-Williams Co. operating profit margin ratio improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021 not reaching 2019 level. |
Net Profit Margin
Sherwin-Williams Co., net profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income | 1,864,400) | 2,030,400) | 1,541,300) | 1,108,746) | 1,772,262) | |
| Net sales | 19,944,600) | 18,361,700) | 17,900,800) | 17,534,493) | 14,983,788) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 9.35% | 11.06% | 8.61% | 6.32% | 11.83% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Linde plc | 12.42% | 9.18% | 8.09% | — | — | |
| Net Profit Margin, Industry | ||||||
| Materials | 15.16% | 7.48% | 4.80% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net profit margin = 100 × Net income ÷ Net sales
= 100 × 1,864,400 ÷ 19,944,600 = 9.35%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Sherwin-Williams Co. net profit margin ratio improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021 not reaching 2019 level. |
Return on Equity (ROE)
Sherwin-Williams Co., ROE calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income | 1,864,400) | 2,030,400) | 1,541,300) | 1,108,746) | 1,772,262) | |
| Shareholders’ equity | 2,437,200) | 3,610,800) | 4,123,300) | 3,730,745) | 3,692,188) | |
| Profitability Ratio | ||||||
| ROE1 | 76.50% | 56.23% | 37.38% | 29.72% | 48.00% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Linde plc | 8.69% | 5.29% | 4.66% | — | — | |
| ROE, Industry | ||||||
| Materials | 14.02% | 5.39% | 3.51% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
ROE = 100 × Net income ÷ Shareholders’ equity
= 100 × 1,864,400 ÷ 2,437,200 = 76.50%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Sherwin-Williams Co. ROE improved from 2019 to 2020 and from 2020 to 2021. |
Return on Assets (ROA)
Sherwin-Williams Co., ROA calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income | 1,864,400) | 2,030,400) | 1,541,300) | 1,108,746) | 1,772,262) | |
| Total assets | 20,666,700) | 20,401,600) | 20,496,200) | 19,134,279) | 19,958,427) | |
| Profitability Ratio | ||||||
| ROA1 | 9.02% | 9.95% | 7.52% | 5.79% | 8.88% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Linde plc | 4.69% | 2.83% | 2.64% | — | — | |
| ROA, Industry | ||||||
| Materials | 6.27% | 2.38% | 1.61% | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 1,864,400 ÷ 20,666,700 = 9.02%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Sherwin-Williams Co. ROA improved from 2019 to 2020 but then slightly deteriorated from 2020 to 2021. |