Certara Inc (CERT)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -38,704 | -32,227 | 36,528 | 13,462 | -24,885 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,058,660 | 1,046,840 | 1,079,660 | 1,041,850 | 822,132 |
| Return on total capital | -3.66% | -3.08% | 3.38% | 1.29% | -3.03% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-38,704K ÷ ($—K + $1,058,660K)
= -3.66%
Certara Inc's return on total capital has shown fluctuation over the years based on the provided data. The return on total capital was negative in 2020 at -3.03%, indicating that the company's capital was not effectively utilized to generate profits. However, there was an improvement in 2021 with a return of 1.29%, suggesting better capital efficiency.
In 2022, Certara Inc's return on total capital further increased to 3.38%, indicating a positive trend in capital utilization and profitability. However, this trend reversed in 2023 with a return of -3.08%, suggesting potential challenges in effectively deploying capital during that year.
The decline continued in 2024 with a return on total capital of -3.66%, highlighting a decrease in profitability relative to the capital employed. Overall, Certara Inc's return on total capital demonstrates variability, reflecting fluctuations in the company's ability to generate returns from its total capital investments.
Peer comparison
Dec 31, 2024