Walt Disney Company (DIS)
Return on total capital
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,760,000 | 3,328,000 | 474,000 | -518,000 | 15,326,000 |
| Long-term debt | US$ in thousands | 42,101,000 | 45,299,000 | 48,540,000 | 52,917,000 | 38,129,000 |
| Total stockholders’ equity | US$ in thousands | 99,277,000 | 95,008,000 | 88,553,000 | 83,583,000 | 88,877,000 |
| Return on total capital | 1.24% | 2.37% | 0.35% | -0.38% | 12.07% |
September 30, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,760,000K ÷ ($42,101,000K + $99,277,000K)
= 1.24%
Walt Disney Co has shown a consistent trend in its return on total capital over the past five years. In September 2023, the return on total capital stood at 6.71%, which is an improvement from the previous year's 5.28%. This demonstrates the company's ability to generate more profit per dollar of total capital invested.
Looking back to October 2021 and October 2020, the returns were 3.09% and 3.13%, respectively. The slight increase in 2023 reflects the company's efforts to efficiently utilize its capital and improve profitability.
It's notable that in September 2019, the return on total capital was at a relatively high 8.65%. While the recent figure of 6.71% is lower, it's important to consider the context of the global pandemic and its impact on the entertainment and travel industries, in which Disney operates.
Overall, Walt Disney Co has demonstrated a consistent ability to deliver returns on its total capital, and the recent increase is a positive indicator of the company's financial performance and management of invested capital. However, it's essential to closely monitor future trends to assess the company's ability to maintain or further improve its return on total capital.
Peer comparison
Sep 30, 2023