FormFactor Inc (FORM)
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 | 89,688 | 58,449 | 99,102 | 86,039 | 52,978 |
| Long-term debt | US$ in thousands | 13,314 | 14,389 | 15,434 | 24,978 | 15,639 |
| Total stockholders’ equity | US$ in thousands | 908,804 | 808,285 | 815,780 | 744,084 | 640,997 |
| Return on total capital | 9.73% | 7.10% | 11.92% | 11.19% | 8.07% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $89,688K ÷ ($13,314K + $908,804K)
= 9.73%
FormFactor Inc's return on total capital has shown fluctuations over the past five years. In 2023, the return on total capital increased to 9.73%, up from 7.10% in 2022. This signifies an improvement in the company's ability to generate profits from its total invested capital. Despite the increase in 2023, the return on total capital was lower than the 11.92% recorded in 2021 but higher than the 11.19% in 2020 and the 8.07% in 2019.
The variability in FormFactor Inc's return on total capital indicates that the company's efficiency in utilizing its total capital to generate profits has been inconsistent in recent years. Further analysis of the company's financial performance and capital structure may be required to understand the factors influencing these fluctuations in return on total capital.
Peer comparison
Dec 31, 2023