Boston Scientific Corp (BSX)
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 | 2,343,000 | 1,649,000 | 1,199,000 | -80,000 | 1,518,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 19,282,000 | 17,573,000 | 16,623,000 | 15,327,000 | 13,877,000 |
| Return on total capital | 12.15% | 9.38% | 7.21% | -0.52% | 10.94% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,343,000K ÷ ($—K + $19,282,000K)
= 12.15%
Boston Scientific Corp.'s return on total capital has shown fluctuations over the past five years. In 2023, the company's return on total capital improved to 8.52%, marking a positive increase compared to the previous year's 7.67%. This suggests that the company was able to generate a higher return relative to its total capital deployed in 2023.
Comparing the latest return on total capital figure to earlier years, it is also higher than the 7.10% reported in 2021, indicating a positive trend in the company's capital efficiency. However, it is noteworthy that the return on total capital was notably lower in 2020 at 2.80%, which may have been influenced by various factors such as economic conditions or operational challenges.
Looking back to 2019, where the return on total capital was at 7.28%, the 2023 figure of 8.52% demonstrates an improvement over this longer timeframe, which is an encouraging sign for Boston Scientific Corp.'s capital utilization efficiency. Overall, the recent increase in return on total capital reflects positively on the company's ability to generate returns from the capital invested, although continued monitoring of this metric will be important to assess the company's ongoing performance.
Peer comparison
Dec 31, 2023