Crescent Energy Co (CRGY)

Return on total capital

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	243,293	219,445	145,518	236,683	157,633	372,821	424,624	228,949	183,818
Long-term debt	US$ in thousands	3,225,170	2,403,680	1,749,230	1,694,380	1,912,190	1,331,560	1,244,590	1,247,560	1,372,330	1,515,700	1,626,870	1,030,410
Total stockholders’ equity	US$ in thousands	4,195,430	3,587,090	3,542,960	3,635,720	3,515,940	3,517,420	3,523,650	3,298,990	3,268,980	2,788,720	2,608,040	3,019,660
Return on total capital		3.28%	3.66%	2.75%	4.44%	2.90%	7.69%	8.91%	5.04%	3.96%

September 30, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $243,293K ÷ ($3,225,170K + $4,195,430K)
= 3.28%

Crescent Energy Co's return on total capital has shown some fluctuations over the past few quarters. The return on total capital for the most recent quarter, ending September 30, 2024, was 3.28%, which was lower than the previous quarter's 3.66% and significantly lower than the high return of 8.91% reported in the first quarter of 2023.

The trend in return on total capital indicates variability in the company's ability to generate profits relative to the total capital employed in its operations. Lower returns may suggest inefficiencies or challenges in utilizing the company's capital effectively to generate earnings. It is important for Crescent Energy Co to closely monitor and assess the factors influencing its return on total capital and take proactive measures to improve efficiency and profitability.

Analyzing the return on total capital in conjunction with other financial metrics and industry benchmarks can provide a more comprehensive assessment of Crescent Energy Co's financial performance and overall operational effectiveness. Moreover, management should consider implementing strategies to enhance profitability and optimize the utilization of capital to drive sustainable growth and value creation for the company and its stakeholders.