The Ensign Group Inc (ENSG)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 358,304 | 280,398 | 298,049 | 261,780 | 226,082 |
| Long-term debt | US$ in thousands | 141,585 | 145,497 | 149,269 | 152,883 | — |
| Total stockholders’ equity | US$ in thousands | 1,837,110 | 1,491,860 | 1,247,330 | 1,020,770 | 818,077 |
| Return on total capital | 18.11% | 17.13% | 21.34% | 22.30% | 27.64% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $358,304K ÷ ($141,585K + $1,837,110K)
= 18.11%
Based on the data provided, The Ensign Group Inc's return on total capital has exhibited a general downward trend over the five-year period from December 31, 2020, to December 31, 2024. The return on total capital was 27.64% in 2020, but decreased to 22.30% in 2021, 21.34% in 2022, 17.13% in 2023, and then slightly improved to 18.11% in 2024.
This trend suggests that the company may be facing challenges in generating returns on its total capital investment. A declining return on total capital could indicate inefficiencies in capital deployment, lower profitability, or an increase in the cost of capital. It is crucial for the company to closely monitor and address the factors contributing to this decline to ensure optimal utilization of capital resources and sustain long-term financial performance.
Peer comparison
Dec 31, 2024