Caesars Entertainment Corporation (CZR)
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 | 2,292,000 | 1,363,000 | 1,018,000 | -412,000 | 411,000 |
| Long-term debt | US$ in thousands | 12,224,000 | 12,659,000 | 13,722,000 | 14,073,000 | 2,325,000 |
| Total stockholders’ equity | US$ in thousands | 4,552,000 | 3,713,000 | 4,480,000 | 5,016,000 | 1,117,000 |
| Return on total capital | 13.66% | 8.33% | 5.59% | -2.16% | 11.94% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,292,000K ÷ ($12,224,000K + $4,552,000K)
= 13.66%
Caesars Entertainment Inc's return on total capital has shown fluctuating trends over the past five years. In 2023, the return on total capital increased to 8.63%, continuing the upward trend from the previous year's 6.40%. This improvement indicates that Caesars has been able to generate a higher return relative to the total capital employed in the business.
The significant improvement in 2023 can be attributed to possibly more efficient operations, better capital allocation decisions, or increased profitability. In contrast, the return on total capital was negative in 2020 at -0.71%, indicating that the company's capital was not efficiently utilized to generate profits during that year.
Overall, Caesars Entertainment Inc's return on total capital has shown variability, but the recent improvement suggests a positive performance trend. It is essential for the company to sustain or further enhance its return on total capital to ensure efficient utilization of capital and maximize shareholder value.
Peer comparison
Dec 31, 2023