Carter’s Inc (CRI)

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	336,215	359,517	498,584	191,046	365,569
Long-term debt	US$ in thousands	497,354	616,624	991,370	989,530	594,672
Total stockholders’ equity	US$ in thousands	845,250	796,409	950,186	938,033	880,130
Return on total capital		25.04%	25.44%	25.68%	9.91%	24.79%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $336,215K ÷ ($497,354K + $845,250K)
= 25.04%

Carter’s Inc has maintained a relatively stable return on total capital over the past five years. The return on total capital was 25.04% as of December 31, 2023, showing a slight decrease from the previous year's 25.44%. Despite this slight decline, the company's return on total capital remains strong, indicating that Carter’s is effectively generating returns from both its debt and equity investments. It is worth noting that in 2020, the return on total capital dipped to 9.91%, which seems to be an aberration compared to the other years where the returns were consistently above 24%. Overall, Carter’s Inc's consistent high return on total capital suggests efficient capital allocation and effective management of both debt and equity capital to drive profitability.