Centene Corp (CNC)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 4,326,000 | 2,627,000 | 2,489,000 | 3,515,000 | 2,206,000 |
| Long-term debt | US$ in thousands | 17,710,000 | 17,938,000 | 18,571,000 | 16,682,000 | 13,638,000 |
| Total stockholders’ equity | US$ in thousands | 25,840,000 | 24,057,000 | 26,795,000 | 25,773,000 | 12,551,000 |
| Return on total capital | 9.93% | 6.26% | 5.49% | 8.28% | 8.42% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $4,326,000K ÷ ($17,710,000K + $25,840,000K)
= 9.93%
Centene Corp.'s return on total capital has exhibited fluctuations over the past five years. In 2023, the return on total capital decreased to 7.92% from 8.64% in 2022. This decline suggests that the company's ability to generate earnings from its total capital slightly weakened compared to the previous year. However, the return in 2023 remained higher than in 2021 (7.15%) and 2020 (7.41%), indicating relative stability.
Despite the slight dip in 2023, Centene Corp.'s return on total capital has generally been consistent around the 7-8% range over the five-year period, with the highest return recorded in 2022 at 8.64%. This suggests that the company has been relatively effective in utilizing its total capital to generate profits. Investors and stakeholders may monitor future trends in return on total capital to assess the company's efficiency in deploying capital to achieve profitability.
Peer comparison
Dec 31, 2023