American Woodmark Corporation (AMWD)
Return on total capital
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 161,394 | 136,352 | 36,159 | 114,738 | 141,694 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 910,376 | 873,788 | 772,883 | 756,238 | 632,473 |
| Return on total capital | 17.73% | 15.60% | 4.68% | 15.17% | 22.40% |
April 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $161,394K ÷ ($—K + $910,376K)
= 17.73%
American Woodmark Corporation's return on total capital has fluctuated over the past five years. In the most recent fiscal year ending April 30, 2024, the company achieved a return on total capital of 17.73%, showing an improvement from the previous year's 15.60%. However, this return is lower than the peak of 22.40% recorded in the fiscal year ending April 30, 2019.
The return on total capital in the fiscal year ending April 30, 2022, was significantly lower at 4.68%, indicating a period of lower efficiency in generating returns on the company's total capital. It is important for American Woodmark Corporation to monitor and improve this metric to ensure optimal utilization of its capital resources.
Overall, the company's return on total capital has shown variability, with performance fluctuations observed across the years. This metric is crucial in evaluating a company's efficiency in generating returns from both its debt and equity investments, and American Woodmark Corporation should strive to maintain consistent and competitive returns to enhance shareholder value.