Cadence Design Systems Inc (CDNS)

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 1,318,111 1,166,667 1,115,390 1,085,015 1,068,297 1,046,995 982,151 892,806 785,415 778,172 756,319 725,318 653,497 572,082 521,992 498,977 497,797 501,105 484,893 448,022
Long-term debt US$ in thousands 299,771 648,801 648,551 648,301 648,078 — — — 347,588 — — — 346,793 346,584 346,394 346,205 346,019 345,833 345,652 345,470
Total stockholders’ equity US$ in thousands 3,404,270 3,113,890 2,908,460 2,940,880 2,745,110 2,708,130 2,625,230 2,760,180 2,740,680 2,631,260 2,516,740 2,542,430 2,493,020 2,395,720 2,256,630 2,157,990 2,102,890 1,480,260 1,430,540 1,365,840
Return on total capital 35.59% 31.01% 31.36% 30.23% 31.48% 38.66% 37.41% 32.35% 25.43% 29.57% 30.05% 28.53% 23.01% 20.86% 20.05% 19.93% 20.33% 27.44% 27.30% 26.18%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,318,111K ÷ ($299,771K + $3,404,270K)
= 35.59%

Cadence Design Systems, Inc. has shown consistent performance in terms of return on total capital over the past eight quarters. The return on total capital fluctuated between 28.74% and 33.34% during this period, with an average of approximately 30.50%.

The company's ability to generate returns on the total capital employed indicates efficient utilization of both debt and equity to generate profits. The consistently high return on total capital reflects the company's effective management of its resources and investments.

Overall, Cadence Design Systems, Inc. has demonstrated a strong performance in terms of return on total capital, which is a positive indicator of its financial health and operational efficiency.