Builders FirstSource Inc (BLDR)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,595,250 | 2,176,320 | 3,770,210 | 2,387,420 | 543,854 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,296,470 | 4,732,350 | 4,962,570 | 4,802,480 | 1,152,780 |
| Return on total capital | 37.13% | 45.99% | 75.97% | 49.71% | 47.18% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,595,250K ÷ ($—K + $4,296,470K)
= 37.13%
Builders FirstSource Inc's return on total capital has shown fluctuations over the past five years. The ratio increased from 47.18% in December 31, 2020, to 49.71% in December 31, 2021, indicating a positive trend in the company's ability to generate returns from its total capital. However, there was a significant jump to 75.97% in December 31, 2022, which suggests a substantial improvement in capital efficiency.
Subsequently, there was a decrease to 45.99% in December 31, 2023, and a further decline to 37.13% in December 31, 2024, indicating a downward trend in the returns being generated from the total capital employed. Overall, while there have been fluctuations in the return on total capital, with some years showing strong performance and others showing a decline, it is essential for stakeholders to monitor this ratio closely to assess the company's capital efficiency and financial performance.
Peer comparison
Dec 31, 2024