Operating profit rate: it is the ratio of operating profit to operating income of an enterprise in a certain period of time. Operating profit margin refers to the percentage of operating profit to net sales or the percentage of invested capital. This percentage can comprehensively reflect the operating efficiency of an enterprise or an industry. The operating profit margins of different industries and enterprises in the same industry vary greatly, and not all enterprises can make profits every year.
Cost-expense profit rate: it is the ratio of total profit to total cost of an enterprise in a certain period.
Surplus cash guarantee multiple: it is the ratio of net operating cash flow to net profit in a certain period, which reflects the guarantee degree of cash income in the current net profit of the enterprise and truly reflects the quality of enterprise surplus. Residual cash guarantee multiple evaluates the quality of enterprise income from the dynamic perspective of cash inflow and outflow, and corrects the actual income ability of enterprises again.
Return on total assets: It is the ratio of the total amount of remuneration obtained by an enterprise to the average total amount of assets in a certain period, which affects the comprehensive utilization effect of enterprise assets. It represents the overall profitability of all assets of an enterprise, including net assets and liabilities, and is used to evaluate the overall profitability of an enterprise in using all assets, which is an important index to evaluate the efficiency of enterprise asset operation.
Return on net assets: it is the ratio of net profit to average net assets of an enterprise in a certain period, reflecting the investment income level of its own funds. This index reflects the income level of shareholders' equity and is used to measure the efficiency of the company's use of its own capital. The higher the index value, the higher the return on investment. This indicator reflects the ability of self-owned capital to obtain net income.
Judgment of enterprise profitability
Profitability refers to the level of net profit obtained by a company through its business activities. It is an important index to measure the performance of an enterprise, reflecting its operating conditions and benefits. Profitability helps to judge whether an enterprise can continue to grow and operate in the future, and covers its capital cost.
Companies can improve their profitability through various strategies, such as reducing production costs, increasing sales, streamlining financial expenditures and improving enterprise management. Improving enterprise management is the key to improve profitability, because it can effectively control costs, reduce business risks and promote the sustainable growth of enterprises.
In addition, profitability is also affected by the market, such as the level of industry development, public opinion, economic environment and so on. Therefore, enterprises should sum up experience in time, strengthen market research, speed up technological innovation, grasp market trends, and better realize sustainable profitability and competitive advantage.