Abbott Laboratories (ABT)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 7,301,000 | 8,864,000 | 8,744,000 | 5,538,000 | 4,747,000 |
| Long-term debt | US$ in thousands | 13,599,000 | 14,522,000 | 17,296,000 | 18,527,000 | 16,661,000 |
| Total stockholders’ equity | US$ in thousands | 38,603,000 | 36,686,000 | 35,802,000 | 32,784,000 | 31,088,000 |
| Return on total capital | 13.99% | 17.31% | 16.47% | 10.79% | 9.94% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $7,301,000K ÷ ($13,599,000K + $38,603,000K)
= 13.99%
Abbott Laboratories' return on total capital has shown a fluctuating trend over the past five years. The company's return on total capital was 12.16% as of December 31, 2023, a decrease from the previous year's 15.64%. This indicates that the company's efficiency in generating profits from its total capital invested decreased in the most recent year.
Looking back over the past five years, Abbott Laboratories' return on total capital has generally been favorable, consistently above 10%. The peak return was recorded in 2022 and 2021 at 15.64%, showcasing the company's ability to efficiently utilize its total capital to generate returns for shareholders.
Overall, Abbott Laboratories has demonstrated a strong ability to generate returns on its total capital over the years, reflecting effective management of its resources and capital allocation strategies. Monitoring this metric in conjunction with other financial ratios can provide investors with valuable insights into the company's financial performance and sustainability.
Peer comparison
Dec 31, 2023