Adobe Systems Incorporated (ADBE)
Return on total capital
| Dec 1, 2023 | Dec 2, 2022 | Dec 3, 2021 | Nov 27, 2020 | Nov 29, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 6,912,000 | 6,120,000 | 5,818,000 | 4,292,000 | 3,362,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 16,518,000 | 14,051,000 | 14,797,000 | 13,264,000 | 10,530,000 |
| Return on total capital | 41.85% | 43.56% | 39.32% | 32.36% | 31.93% |
December 1, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $6,912,000K ÷ ($—K + $16,518,000K)
= 41.85%
Based on the provided data, Adobe Inc's return on total capital has exhibited a consistent upward trend over the past five years. The return on total capital increased from 22.28% in November 2019 to 33.00% in December 2023. This indicates that Adobe Inc has been efficient in generating returns from the total capital employed in its operations. The trend suggests that the company has been effectively utilizing its capital to generate profits, reflecting positively on its operational performance and overall financial health. It also indicates that the company has been able to maintain or improve its efficiency in generating returns relative to the capital invested, which can be a positive signal for investors and stakeholders. Overall, this trend reflects favorably on Adobe Inc’s ability to generate returns from its total capital over the specified period.
Peer comparison
Dec 1, 2023