First Solar Inc (FSLR)
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 | 1,394,420 | 904,255 | 20,823 | 585,269 | 315,097 |
| Long-term debt | US$ in thousands | 373,354 | 464,068 | 184,349 | 236,005 | 237,691 |
| Total stockholders’ equity | US$ in thousands | 7,977,580 | 6,687,470 | 5,836,060 | 5,959,550 | 5,520,930 |
| Return on total capital | 16.70% | 12.64% | 0.35% | 9.45% | 5.47% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,394,420K ÷ ($373,354K + $7,977,580K)
= 16.70%
First Solar Inc's return on total capital has displayed fluctuating trends over the years, indicating varying levels of efficiency in utilizing its capital resources. The return on total capital stood at 5.47% as of December 31, 2020, showing a gradual improvement to 9.45% by December 31, 2021. However, there was a significant decline to 0.35% by December 31, 2022, suggesting potential challenges in generating returns on the total invested capital.
Subsequently, there was a notable rebound in the return on total capital to 12.64% by December 31, 2023, displaying a substantial improvement in capital efficiency. The most recent data point as of December 31, 2024, reveals a further increase to 16.70%, indicating a strong performance in utilizing capital resources effectively to generate higher returns.
Overall, the trend in First Solar Inc's return on total capital reflects a mix of periods of improvement and challenges, highlighting the importance of monitoring and optimizing capital allocation strategies to enhance overall financial performance.
Peer comparison
Dec 31, 2024