Calavo Growers Inc (CVGW)
Return on total capital
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 93 | -1,312 | -273 | -17,040 | 50,476 |
| Long-term debt | US$ in thousands | 7,300 | 6,000 | 7,100 | 7,100 | 6,200 |
| Total stockholders’ equity | US$ in thousands | 208,837 | 222,356 | 225,515 | 254,530 | 284,181 |
| Return on total capital | 0.04% | -0.57% | -0.12% | -6.51% | 17.38% |
October 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $93K ÷ ($7,300K + $208,837K)
= 0.04%
Calavo Growers, Inc's return on total capital has exhibited a declining trend over the past five years. The return on total capital decreased from 18.90% in 2019 to 1.05% in 2023. This indicates a significant decline in the company's ability to generate profits from its total invested capital. The decrease in return on total capital could be attributed to various factors such as changes in the company's profitability, asset efficiency, or capital structure. Analyzing the underlying reasons for the declining trend in return on total capital would be crucial in understanding the company's performance and identifying potential areas for improvement.