Donaldson Company Inc (DCI)
Return on total capital
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 544,100 | 487,900 | 453,300 | 394,000 | 352,600 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,489,100 | 1,320,700 | 1,133,200 | 1,137,100 | 992,900 |
| Return on total capital | 36.54% | 36.94% | 40.00% | 34.65% | 35.51% |
July 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $544,100K ÷ ($—K + $1,489,100K)
= 36.54%
Donaldson Company Inc's return on total capital has shown stability and strong performance over the past five years. The company's return on total capital ranged from 34.65% to 40.00%, with the most recent figure standing at 36.54%. This indicates that for every dollar of total capital employed in the business, Donaldson Company Inc generated a return ranging from 34.65 cents to 40 cents.
The consistent high performance in return on total capital suggests that Donaldson Company Inc efficiently utilizes its capital to generate profits, indicating effective management of its assets and liabilities. The company's ability to maintain a high return on total capital reflects positively on its operational efficiency and overall financial health.
Investors and stakeholders may view Donaldson Company Inc favorably due to its ability to generate strong returns on the capital invested in the business consistently. This metric indicates the company's profitability and efficiency in utilizing its resources to create value for shareholders.