Allegro Microsystems Inc (ALGM)
Return on total capital
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 23, 2022 | Sep 23, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -21,359 | 18,710 | 125,277 | 205,369 | 251,418 | 283,922 | 269,730 | 213,386 | 175,283 | 142,255 | 121,226 | 140,978 | 129,888 | 66,020 | 39,868 |
| Long-term debt | US$ in thousands | 374,729 | 396,056 | 202,589 | 249,611 | 250,464 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 | 25,000 |
| Total stockholders’ equity | US$ in thousands | 933,045 | 937,314 | 1,108,580 | 1,130,440 | 1,134,230 | 1,097,090 | 1,026,580 | 965,628 | 893,379 | 814,786 | 762,236 | 734,207 | 694,669 | 655,423 | 618,252 |
| Return on total capital | -1.63% | 1.40% | 9.55% | 14.88% | 18.16% | 25.30% | 25.65% | 21.54% | 19.09% | 16.94% | 15.40% | 18.57% | 18.05% | 9.70% | 6.20% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $-21,359K ÷ ($374,729K + $933,045K)
= -1.63%
Allegro Microsystems Inc's return on total capital has shown some fluctuations over the periods provided. From June 30, 2021, to June 30, 2022, there was a general upward trend in the return on total capital, reaching a peak of 25.65% on June 30, 2023. This indicates that the company was generating more profit relative to the total capital employed during this period.
However, from September 30, 2023, onwards, there was a decline in the return on total capital, dropping to 1.40% on September 30, 2024, and further decreasing to -1.63% by December 31, 2024. These declining values suggest that the company's profitability relative to the total capital invested deteriorated significantly in the latter periods.
The significant decrease in the return on total capital from the peak in 2023 to the negative values by the end of 2024 could be a cause for concern. It may indicate potential issues with the company's operational efficiency, profitability, or capital structure that need to be addressed to improve overall financial performance.
Peer comparison
Dec 31, 2024