CTS Corporation (CTS)

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	78,484	82,929	-58,769	48,751	52,914
Long-term debt	US$ in thousands	67,500	83,670	50,000	54,600	99,700
Total stockholders’ equity	US$ in thousands	526,822	506,224	463,578	423,682	405,219
Return on total capital		13.21%	14.06%	-11.44%	10.19%	10.48%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $78,484K ÷ ($67,500K + $526,822K)
= 13.21%

The return on total capital for CTS Corp. has fluctuated over the past five years. In 2023, the return on total capital decreased to 13.82% from 16.09% in 2022 but remained above the levels seen in 2020 and 2019. This indicates that the company was able to generate earnings relative to its total capital invested, although at a slightly lower rate compared to the previous year. The return on total capital was relatively stable between 2019 and 2022, showing consistent performance in utilizing its capital efficiently. Overall, a return on total capital above 10% suggests that CTS Corp. has been effectively utilizing its capital to generate returns for its shareholders. However, the decreasing trend in 2023 should be monitored to understand the underlying factors affecting the company's profitability and capital efficiency.