ABB LTD: (ABB: NYSE) Profitability

Earnings and Earnings Growth

1. Earnings = sales x profit margin

• 2010 – $31.589 billion x 8.11% = $2.561 billion
• 2011 – $37.990 billion x 8.33% = $3.168 billion

ABB LTD’s earnings increased from $2.561 billion in 2010 to $3.168 billion in 2011 or by 23.7%.

2. Five-year historical look at earnings growth

• 2007 – $3.611 billion,
• 2008 – $3.118 billion, 15.81% decrease
• 2009 – $2.901 billion, 7.48% decrease
• 2010 – $2.561 billion, 13.27% decrease
• 2011 – $3.168 billion, 23.70% increase

In analyzing the earnings growth of ABB LTD over the past five years, you see ABB’s earnings have decreased year over year more than they have increased. In 2011 the earnings have increased by 23.70% over 2010 showing a nice rebound. Over the past few years ABB’s earnings have been decreasing but in 2011 the earnings increased by 23.70% to end up 13.98% lower than 2007.

To read more: ABB LTD: Profitability Analysis