CNH Industrial N.V. (CNH)
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 | 3,062,000 | 4,012,000 | 3,342,000 | 2,444,000 | 199,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 7,651,000 | 8,030,000 | 6,927,000 | 6,778,000 | 4,907,000 |
| Return on total capital | 40.02% | 49.96% | 48.25% | 36.06% | 4.06% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,062,000K ÷ ($—K + $7,651,000K)
= 40.02%
Based on the data provided, CNH Industrial N.V.'s return on total capital has shown significant improvement over the last five years. The return on total capital increased from 4.06% in December 2020 to 40.02% in December 2024. This indicates that the company has been effectively utilizing its capital to generate returns for its stakeholders.
The substantial increase in the return on total capital suggests that CNH Industrial N.V. has been successful in enhancing its operational efficiency and profitability over the years. This improvement could be attributed to various factors such as better cost management, effective utilization of assets, and strategic investments.
Overall, the trend of increasing return on total capital is positive for CNH Industrial N.V. and indicates a strong financial performance and effective capital allocation by the company. This metric reflects the company's ability to generate profits relative to the total capital employed, highlighting its financial health and operational effectiveness.
Peer comparison
Dec 31, 2024