Cars.com Inc (CARS)

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 54,116 58,992 64,573 67,624 66,036 50,287 42,462 42,732 48,338 60,173 67,162 34,283 -887,327 -898,518 -1,365,297 -1,347,069 -446,060 -426,896 49,151 72,704
Long-term debt US$ in thousands 460,119 429,679 434,210 438,739 458,249 482,740 495,968 499,182 457,383 470,520 502,357 524,260 576,143 558,720 609,066 763,361 611,277 630,913 644,046 652,178
Total stockholders’ equity US$ in thousands 492,108 483,010 477,457 384,987 384,430 376,527 391,388 396,087 398,020 394,574 385,456 374,016 368,190 322,373 328,781 347,890 1,141,070 1,141,480 1,569,150 1,592,670
Return on total capital 5.68% 6.46% 7.08% 8.21% 7.84% 5.85% 4.79% 4.77% 5.65% 6.96% 7.56% 3.82% -93.96% -101.98% -145.58% -121.22% -25.46% -24.09% 2.22% 3.24%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $54,116K ÷ ($460,119K + $492,108K)
= 5.68%

Cars.com's return on total capital has shown improvement over the past two quarters, increasing from 5.77% in Q3 2022 to 6.96% in Q2 2023 and further to 8.06% in Q1 2023. This indicates that the company's ability to generate profits from its total capital invested has been strengthening. However, it is important to note that in Q4 2023, the return on total capital decreased to 5.55%, which may indicate a slight dip in profitability compared to the previous quarters. Overall, the trend suggests that Cars.com has been effectively utilizing its capital to generate returns, with some fluctuations in performance over the analyzed period.