The Cheesecake Factory (CAKE)

Return on total capital

Jan 31, 2025 Dec 31, 2024 Oct 31, 2024 Sep 30, 2024 Jul 31, 2024 Jun 30, 2024 Apr 30, 2024 Mar 31, 2024 Jan 31, 2024 Dec 31, 2023 Oct 31, 2023 Sep 30, 2023 Jul 31, 2023 Jun 30, 2023 Apr 30, 2023 Mar 31, 2023 Jan 31, 2023 Dec 31, 2022 Oct 31, 2022 Sep 30, 2022
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 163,501 180,657 192,717 207,394 212,987 199,703 149,150 121,265 101,002 95,766 135,098 151,963 166,859 103,631 41,037 1,475 -34,656 12,410 55,475 87,099
Long-term debt US$ in thousands — 452,062 — 471,558 — 471,054 — 470,551 — 470,047 — 469,543 — 469,040 — 468,536 — 468,032 — 467,528
Total stockholders’ equity US$ in thousands 443,455 443,455 396,379 396,379 373,980 373,980 332,438 332,438 318,062 318,062 321,644 321,644 325,903 325,903 299,839 299,839 292,003 292,003 323,496 323,496
Return on total capital 36.87% 20.17% 48.62% 23.90% 56.95% 23.63% 44.87% 15.10% 31.76% 12.15% 42.00% 19.21% 51.20% 13.04% 13.69% 0.19% -11.87% 1.63% 17.15% 11.01%

January 31, 2025 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $163,501K ÷ ($—K + $443,455K)
= 36.87%

The return on total capital for The Cheesecake Factory has varied over the analyzed periods, showing fluctuations in its efficiency in generating profits relative to the total capital invested in the business.

- The data reveals that the return on total capital was relatively stable around 10-20% from September 2022 to January 2023, with a slight decrease in December 2022 and a significant drop in January 2023 to a negative value indicating a loss.

- However, from April 2023 onwards, there was a noticeable improvement in the return on total capital, with positive percentages ranging from 13% to 56% until January 2025.

- Particularly high returns were observed in July 2023, April 2024, and July 2024, exceeding 50%, signaling robust profitability relative to total capital during those periods.

- Overall, the trend indicates that The Cheesecake Factory effectively utilized its total capital to generate returns, with occasional fluctuations that may reflect changes in the business's operational efficiency or profitability dynamics. Further analysis would be necessary to understand the factors driving the variations in return on total capital during the analyzed periods.