Chemed Corp (CHE)

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	353,475	321,541	305,574	321,467	334,263	346,914	365,175	353,651	352,182	401,721	387,701	412,491	398,345	332,882	318,863	284,130	266,144	249,399	245,448	239,086
Long-term debt	US$ in thousands	—	—	—	16,250	92,500	95,850	111,800	120,000	185,000	—	—	—	—	—	—	160,000	90,000	130,000	85,000	100,000
Total stockholders’ equity	US$ in thousands	1,107,880	1,019,240	952,079	880,053	798,715	721,416	684,960	666,705	623,273	779,719	870,774	928,884	901,200	801,408	750,696	683,601	726,608	672,380	618,569	588,010
Return on total capital		31.91%	31.55%	32.10%	35.87%	37.51%	42.45%	45.83%	44.95%	43.57%	51.52%	44.52%	44.41%	44.20%	41.54%	42.48%	33.68%	32.59%	31.08%	34.89%	34.75%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $353,475K ÷ ($—K + $1,107,880K)
= 31.91%

The return on total capital for Chemed Corp. has been fluctuating over the past eight quarters, ranging from a low of 30.94% in Q4 2023 to a high of 46.39% in Q3 2022. The trend shows a general decrease in return on total capital over the quarters from 46.39% in Q3 2022 to 30.94% in Q4 2023.

This decline may raise concerns about the company's ability to generate returns on the total funds invested in its operations. However, it is important to consider the industry norms and compare Chemed Corp.'s return on total capital with its peers to gain a better perspective on its performance. Further analysis should involve examining the factors contributing to the downward trend and identifying opportunities for improvement to enhance the company's overall financial health.