EPAM Systems Inc (EPAM)

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	501,239	572,966	542,316	379,324	302,850
Long-term debt	US$ in thousands	26,126	27,693	30,234	25,038	25,074
Total stockholders’ equity	US$ in thousands	3,470,890	3,001,530	2,487,120	1,983,020	1,596,140
Return on total capital		14.33%	18.91%	21.54%	18.89%	18.68%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $501,239K ÷ ($26,126K + $3,470,890K)
= 14.33%

EPAM Systems Inc's return on total capital has shown a declining trend over the past five years. The company's return on total capital decreased from 18.68% in 2019 to 15.07% in 2023. This declining trend indicates that the company may be becoming less efficient in generating returns from its total capital employed over time.

In 2021, EPAM Systems Inc achieved the highest return on total capital at 21.41%, which suggests a strong performance in utilizing its total capital to generate profits. However, the subsequent decrease in this ratio in 2022 and 2023 indicates a potential decrease in profitability relative to the capital invested.

Overall, EPAM Systems Inc's return on total capital indicates fluctuations in the company's efficiency in generating profits from its total capital base. It would be important for investors and stakeholders to closely monitor this trend and assess the reasons behind the fluctuations to understand the company's financial performance and sustainability.