Profitability ratios measure the company ability to generate profitable sales from its resources (assets).

Profitability Ratios (Summary)
Gross Profit Margin
Operating Profit Margin
Net Profit Margin
Return on Equity (ROE)
Return on Assets (ROA)

Waste Management Inc., profitability ratios

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Return on Sales
Gross profit margin	38.03%	38.62%	38.56%	37.98%	37.72%
Operating profit margin	16.54%	15.99%	17.51%	18.70%	18.20%
Net profit margin	10.13%	9.83%	10.81%	12.91%	13.46%
Return on Investment
Return on equity (ROE)	25.49%	20.08%	23.63%	30.68%	32.38%
Return on assets (ROA)	6.24%	5.10%	6.02%	8.50%	8.93%

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).

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Profitability ratio	Description	The company
Gross profit margin	Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures.	Waste Management Inc. 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.	Waste Management Inc. operating profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.
Net profit margin	An indicator of profitability, calculated as net income divided by revenue.	Waste Management Inc. net profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.

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Profitability ratio	Description	The company
ROE	A profitability ratio calculated as net income divided by shareholders’ equity.	Waste Management Inc. ROE deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.
ROA	A profitability ratio calculated as net income divided by total assets.	Waste Management Inc. ROA deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.

Waste Management Inc., gross profit margin calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in millions)
Gross profit	6,820)	5,877)	5,959)	5,665)	5,464)
Operating revenues	17,931)	15,218)	15,455)	14,914)	14,485)
Profitability Ratio
Gross profit margin¹	38.03%	38.62%	38.56%	37.98%	37.72%

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 ÷ Operating revenues
= 100 × 6,820 ÷ 17,931 = 38.03%

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Profitability ratio	Description	The company
Gross profit margin	Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures.	Waste Management Inc. gross profit margin ratio improved from 2019 to 2020 but then deteriorated significantly from 2020 to 2021.

Waste Management Inc., 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 millions)
Income from operations	2,965)	2,434)	2,706)	2,789)	2,636)
Operating revenues	17,931)	15,218)	15,455)	14,914)	14,485)
Profitability Ratio
Operating profit margin¹	16.54%	15.99%	17.51%	18.70%	18.20%
Benchmarks
Operating Profit Margin, Industry
Industrials	9.80%	4.43%	9.67%	—	—

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 × Income from operations ÷ Operating revenues
= 100 × 2,965 ÷ 17,931 = 16.54%

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Profitability ratio	Description	The company
Operating profit margin	A profitability ratio calculated as operating income divided by revenue.	Waste Management Inc. operating profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.

Waste Management Inc., 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 millions)
Net income attributable to Waste Management, Inc.	1,816)	1,496)	1,670)	1,925)	1,949)
Operating revenues	17,931)	15,218)	15,455)	14,914)	14,485)
Profitability Ratio
Net profit margin¹	10.13%	9.83%	10.81%	12.91%	13.46%
Benchmarks
Net Profit Margin, Industry
Industrials	6.43%	1.43%	3.90%	—	—

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 attributable to Waste Management, Inc. ÷ Operating revenues
= 100 × 1,816 ÷ 17,931 = 10.13%

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Profitability ratio	Description	The company
Net profit margin	An indicator of profitability, calculated as net income divided by revenue.	Waste Management Inc. net profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021.

Waste Management Inc., 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 millions)
Net income attributable to Waste Management, Inc.	1,816)	1,496)	1,670)	1,925)	1,949)
Total Waste Management, Inc. stockholders’ equity	7,124)	7,452)	7,068)	6,275)	6,019)
Profitability Ratio
ROE¹	25.49%	20.08%	23.63%	30.68%	32.38%
Benchmarks
ROE, Industry
Industrials	16.58%	3.94%	13.76%	—	—

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 attributable to Waste Management, Inc. ÷ Total Waste Management, Inc. stockholders’ equity
= 100 × 1,816 ÷ 7,124 = 25.49%

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Profitability ratio	Description	The company
ROE	A profitability ratio calculated as net income divided by shareholders’ equity.	Waste Management Inc. ROE deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.

Waste Management Inc., 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 millions)
Net income attributable to Waste Management, Inc.	1,816)	1,496)	1,670)	1,925)	1,949)
Total assets	29,097)	29,345)	27,743)	22,650)	21,829)
Profitability Ratio
ROA¹	6.24%	5.10%	6.02%	8.50%	8.93%
Benchmarks
ROA, Industry
Industrials	3.83%	0.74%	2.39%	—	—

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 attributable to Waste Management, Inc. ÷ Total assets
= 100 × 1,816 ÷ 29,097 = 6.24%

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Profitability ratio	Description	The company
ROA	A profitability ratio calculated as net income divided by total assets.	Waste Management Inc. ROA deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.

Waste Management Inc. (NYSE:WM)

Analysis of Profitability Ratios

Profitability Ratios (Summary)

Gross Profit Margin

Operating Profit Margin

Net Profit Margin

Return on Equity (ROE)

Return on Assets (ROA)