Amphenol Corporation (APH)
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 | 2,576,800 | 2,581,300 | 2,115,400 | 1,632,100 | 1,604,500 |
| Long-term debt | US$ in thousands | 3,742,600 | 4,182,300 | 5,005,800 | 4,031,200 | 3,379,400 |
| Total stockholders’ equity | US$ in thousands | 8,346,500 | 7,015,600 | 6,302,000 | 5,384,900 | 4,530,300 |
| Return on total capital | 21.32% | 23.05% | 18.71% | 17.33% | 20.29% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,576,800K ÷ ($3,742,600K + $8,346,500K)
= 21.32%
Amphenol Corp.'s return on total capital has exhibited variability over the past five years. The trend indicates that the company's ability to generate profits relative to its total invested capital fluctuated from 2019 to 2023.
In 2019, the return on total capital was 20.21%, slightly lower than in 2022 but higher than in 2021 and 2020. This suggests that the company was able to efficiently utilize its total capital to generate returns, although the metric declined slightly in subsequent years.
The return on total capital reached a peak of 22.49% in 2022, indicating a significant improvement in the company's capital efficiency. However, this was followed by a decline in 2023 to 20.45%, which is still relatively strong compared to earlier years but reflects a slight decrease in profitability relative to total capital.
Overall, the fluctuation in Amphenol Corp.'s return on total capital suggests varying levels of operational efficiency and profitability over the five-year period. Further analysis of the company's financial performance and underlying factors affecting capital efficiency may provide valuable insights into its overall financial health.