CF Industries Holdings Inc (CF)
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 | 1,901,000 | 2,398,000 | 5,439,000 | 2,189,000 | 642,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,985,000 | 5,717,000 | 5,051,000 | 3,206,000 | 2,922,000 |
| Return on total capital | 38.13% | 41.95% | 107.68% | 68.28% | 21.97% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,901,000K ÷ ($—K + $4,985,000K)
= 38.13%
CF Industries Holdings Inc's return on total capital has shown a significant improvement over the years based on the provided data. The return on total capital increased from 21.97% as of December 31, 2020, to 68.28% as of December 31, 2021, further climbing to 107.68% by December 31, 2022. However, there was a slight decline in the return on total capital to 41.95% by December 31, 2023, followed by a further decrease to 38.13% by December 31, 2024.
The trend indicates that CF Industries Holdings Inc was able to generate higher returns on the total capital deployed in its operations in the earlier years, reaching a peak in 2022. However, the subsequent years show a decline in this metric, possibly indicating changes in the company's capital structure, investment decisions, or performance of its operations.
It is important for stakeholders to further investigate the factors influencing these fluctuations in return on total capital to assess the company's efficiency in generating returns from its capital investments and to make informed decisions regarding the company's financial health and prospects.
Peer comparison
Dec 31, 2024