Campbell’s Co (CPB)
Return on total capital
| Jul 31, 2025 | Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Jul 28, 2024 | Apr 30, 2024 | Apr 28, 2024 | Jan 31, 2024 | Jan 28, 2024 | Oct 31, 2023 | Oct 29, 2023 | Jul 31, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 29, 2023 | Oct 31, 2022 | Oct 30, 2022 | Jul 31, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,124,000 | 937,000 | 849,000 | 770,000 | 655,000 | 895,000 | 1,134,000 | 1,244,000 | 1,351,000 | 1,306,000 | 1,263,000 | 1,159,000 | 1,150,000 | 1,228,000 | 1,390,000 | 1,573,000 | 1,393,000 | 1,338,000 | 1,196,000 | 1,082,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 3,904,000 | 3,870,000 | 3,910,000 | 3,842,000 | 3,794,000 | 3,794,000 | 3,913,000 | 3,913,000 | 3,849,000 | 3,849,000 | 3,755,000 | 3,755,000 | 3,663,000 | 3,661,000 | 3,588,000 | 3,599,000 | 3,599,000 | 3,467,000 | 3,467,000 | 3,331,000 |
| Return on total capital | 28.79% | 24.21% | 21.71% | 20.04% | 17.26% | 23.59% | 28.98% | 31.79% | 35.10% | 33.93% | 33.64% | 30.87% | 31.40% | 33.54% | 38.74% | 43.71% | 38.71% | 38.59% | 34.50% | 32.48% |
July 31, 2025 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,124,000K ÷ ($—K + $3,904,000K)
= 28.79%
The analysis of Campbell’s Co's return on total capital over the period captured in the provided data reveals notable fluctuations, illustrating shifts in the company's profitability efficiency.
Initially, the return on total capital stood at 32.48% as of July 31, 2022, and experienced an upward trend, reaching a peak of 43.71% by January 31, 2023. This ascent indicates that the company was effectively generating margins relative to its total capital during this period, potentially attributable to operational improvements, favourable market conditions, or both.
Subsequently, there was a decline beginning after the peak, dropping to approximately 38.74% by April 30, 2023. While still relatively high, this downward movement suggests some moderation in profitability, possibly due to increased expenses, competitive pressures, or strategic shifts.
Post-April 2023, the return on total capital continued to decrease, reaching 33.54% at the end of July 2023 and further falling to 30.87% by October 29, 2023. This declining trend signals a reduction in the company’s ability to leverage its total capital efficiently to generate returns, potentially reflecting operational challenges or changes in market dynamics.
Looking ahead, projections indicate a partial recovery, with the ratio rising to approximately 35.10% in January 2024 and stabilizing around 31.79% to 28.98% through April 2024. However, further deterioration is evident with the ratio shrinking to 23.59% in July 2024 and declining sharply to 17.26% by October 31, 2024. This significant drop suggests substantial challenges impacting the company's profitability from late 2024 onwards.
In the subsequent months, there is evidence of modest recovery, with the return on total capital increasing to 21.71% in January 2025, then to 24.21% in April 2025, and further advancing to 28.79% by July 2025. These movements may reflect strategic initiatives to improve operational efficiency or market conditions conducive to better performance.
Overall, the data exhibit a pattern of initial growth and peak profitability followed by a period of notable decline, and later some signs of recovery. The fluctuations may be driven by a combination of internal factors such as operational adjustments, investment strategies, or external influences including market competition and economic conditions. The observed trend emphasizes the importance for Campbell’s Co to address underlying issues impacting its capital efficiency to sustain and enhance future profitability.