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.
Peer comparison
Dec 31, 2023