Barnes Group Inc (B)
Return on total capital
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 91,465 | 85,184 | 101,933 | 45,246 | 52,785 | 62,658 | 77,537 | 142,592 | 144,026 | 140,147 | 128,851 | 100,635 | 117,437 | 146,265 | 180,130 | 226,320 | 227,444 | 219,067 | 210,622 | 218,309 |
| Long-term debt | US$ in thousands | — | 1,307,850 | 564,930 | 563,943 | 569,639 | 556,354 | 582,537 | 594,976 | 599,932 | 628,689 | 654,483 | 664,015 | 699,868 | 701,413 | 711,357 | 783,424 | 825,017 | 856,082 | 889,087 | 877,540 |
| Total stockholders’ equity | US$ in thousands | 1,362,260 | 1,337,050 | 1,376,990 | 1,380,550 | 1,346,330 | 1,267,060 | 1,320,090 | 1,441,030 | 1,428,770 | 1,393,230 | 1,390,390 | 1,351,370 | 1,382,680 | 1,307,660 | 1,257,710 | 1,244,960 | 1,270,530 | 1,210,700 | 1,211,380 | 1,224,500 |
| Return on total capital | 6.71% | 3.22% | 5.25% | 2.33% | 2.76% | 3.44% | 4.08% | 7.00% | 7.10% | 6.93% | 6.30% | 4.99% | 5.64% | 7.28% | 9.15% | 11.16% | 10.85% | 10.60% | 10.03% | 10.39% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $91,465K ÷ ($—K + $1,362,260K)
= 6.71%
Barnes Group Inc.'s return on total capital has shown a declining trend over the past quarters, starting at 7.30% in Q1 2022 and decreasing to 3.35% in Q4 2023. This indicates a decreasing ability of the company to generate returns from its total invested capital over time. The peak return was observed in Q2 2022 at 7.89%, followed by a gradual decline.
The downward trajectory in return on total capital could be a red flag for investors and stakeholders, signaling potential inefficiencies or challenges in utilizing the company's capital effectively to generate profits. It would be advisable for the company to assess and address the factors contributing to this declining trend to improve its financial performance and value creation for shareholders.
Peer comparison
Dec 31, 2023