ABM Industries Incorporated (ABM)
Return on total capital
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 416,200 | 413,400 | 385,600 | 334,800 | 317,000 | 351,000 | 327,900 | 229,600 | 204,600 | 208,400 | 225,100 | 327,800 | 161,500 | 98,000 | 91,600 | 56,000 | 226,800 | 211,200 | 171,800 | 162,500 |
| Long-term debt | US$ in thousands | 1,296,900 | 1,279,800 | 1,292,700 | 1,352,500 | 1,203,400 | 1,086,300 | 1,009,200 | 986,600 | 971,900 | 852,800 | 623,800 | 524,200 | 573,800 | 603,000 | 664,200 | 1,105,700 | 786,300 | 744,200 | 872,200 | 905,500 |
| Total stockholders’ equity | US$ in thousands | 1,822,700 | 1,799,900 | 1,860,100 | 1,782,800 | 1,736,500 | 1,717,200 | 1,680,300 | 1,669,600 | 1,655,200 | 1,609,200 | 1,580,300 | 1,599,800 | 1,569,100 | 1,500,300 | 1,451,300 | 1,395,200 | 1,559,700 | 1,542,000 | 1,503,600 | 1,481,400 |
| Return on total capital | 13.34% | 13.42% | 12.23% | 10.68% | 10.78% | 12.52% | 12.19% | 8.64% | 7.79% | 8.46% | 10.21% | 15.43% | 7.54% | 4.66% | 4.33% | 2.24% | 9.67% | 9.24% | 7.23% | 6.81% |
January 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $416,200K ÷ ($1,296,900K + $1,822,700K)
= 13.34%
ABM Industries Inc.'s return on total capital has shown a generally positive trend over the last eight quarters, ranging from 8.10% in Q2 2022 to a peak of 13.29% in Q4 2023. This indicates that the company has been effectively utilizing its capital to generate returns for its stakeholders. The consistency in achieving double-digit return figures implies a stable performance in effectively managing its assets and liabilities to generate profits.
The increase in return on total capital from 10.16% in Q1 2023 to 13.21% in Q1 2024 suggests an improvement in capital efficiency and profitability, which is a positive signal for investors. Additionally, the gradual increment in the ratio over the quarters indicates a strong financial management strategy and operational efficiency within the company.
Overall, ABM Industries Inc.'s return on total capital demonstrates a positive financial performance trend, indicating that the company has been effectively utilizing its capital resources to generate returns over the analyzed period.
Peer comparison
Jan 31, 2024