Cal-Maine Foods Inc (CALM)
Return on total capital
| May 31, 2025 | Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | Jun 1, 2024 | May 31, 2024 | Mar 2, 2024 | Feb 29, 2024 | Dec 2, 2023 | Nov 30, 2023 | Sep 2, 2023 | Aug 31, 2023 | Jun 3, 2023 | May 31, 2023 | Feb 28, 2023 | Feb 25, 2023 | Nov 30, 2022 | Nov 26, 2022 | Aug 31, 2022 | Aug 27, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,553,041 | 1,241,875 | 786,308 | 670,696 | 638,108 | 510,154 | 363,773 | 194,229 | 34,864 | 156,855 | 293,471 | 704,765 | 1,119,361 | 1,243,033 | 1,332,085 | 1,091,431 | 847,498 | 759,036 | 644,867 | 519,880 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 2,560,620 | 2,381,770 | 2,045,370 | 1,902,550 | 1,800,150 | 1,800,150 | 1,723,750 | 1,723,750 | 1,626,410 | 1,626,410 | 1,613,340 | 1,613,340 | 1,611,080 | 1,611,080 | 1,535,990 | 1,535,990 | 1,320,960 | 1,320,960 | 1,188,320 | 1,188,320 |
| Return on total capital | 60.65% | 52.14% | 38.44% | 35.25% | 35.45% | 28.34% | 21.10% | 11.27% | 2.14% | 9.64% | 18.19% | 43.68% | 69.48% | 77.16% | 86.72% | 71.06% | 64.16% | 57.46% | 54.27% | 43.75% |
May 31, 2025 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,553,041K ÷ ($—K + $2,560,620K)
= 60.65%
The analysis of Cal-Maine Foods Inc's return on total capital (ROTC) over the specified periods reveals considerable fluctuations indicative of dynamic operational performance, financial structure adjustments, or both. Starting from August 27, 2022, the ROTC was documented at 43.75%, demonstrating a solid profitability level in relation to the company’s total capital employed.
Throughout the subsequent months, a notable upward trend was observed, culminating at a peak of 86.72% as of February 28, 2023. This period suggests a highly efficient deployment of total capital to generate earnings, potentially driven by favorable market conditions, operational improvements, or strategic financial decisions.
Post-February 2023, the ratio reflects a downward trajectory, with the ROTC decreasing to 43.68% by August 31, 2023. This sharp decline indicates a reduction in overall capital efficiency or profitability, which may be attributable to increased capital costs, operational challenges, or external market pressures.
The decline persisted further, reaching a low of 2.14% on December 2, 2023. Such a significant drop indicates a period of substantial operational or financial difficulties, resulting in minimal returns relative to total capital. The following months show some recovery, with the ratio rising to approximately 11.27% in late February 2024, then gradually increasing to over 21% by March 2024 and further enhancing to 28.34% in May 2024.
The subsequent periods demonstrate continued improvement, with the ROTC moving upward to 35.45% by June 2024 and remaining relatively stable around the low 30s to mid-30s percentages through August and November 2024. Into 2025, the engine of recovery appears sustained, with the ROTC reaching 52.14% in February and 60.65% in May, indicating a return to higher efficiency levels and possibly improved operational performance or favorable capital conditions.
In summary, the ROTC data for Cal-Maine Foods Inc indicates a pattern characterized by a strong initial period of high profitability, a significant decline towards the end of 2023, followed by a gradual and sustained recovery into 2024 and 2025. The fluctuations suggest the company's profitability relative to its total capital has been influenced by both internal operational factors and external market conditions over this timeframe.