Federal Signal Corporation (FSS)

Return on total capital

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	278,900	274,200	261,100	239,300	224,500	210,400	187,200	172,100	160,900	141,000	135,700	130,000	129,000	136,900	136,600	130,500	134,700	136,300	140,800	154,800
Long-term debt	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	1,186,100	1,149,400	1,099,600	1,044,400	1,001,900	955,900	923,900	882,000	860,900	828,000	809,100	787,800	784,000	765,700	746,000	719,600	702,100	679,800	655,400	636,200
Return on total capital		23.51%	23.86%	23.74%	22.91%	22.41%	22.01%	20.26%	19.51%	18.69%	17.03%	16.77%	16.50%	16.45%	17.88%	18.31%	18.14%	19.19%	20.05%	21.48%	24.33%

December 31, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $278,900K ÷ ($—K + $1,186,100K)
= 23.51%

The return on total capital for Federal Signal Corporation has shown a fluctuating trend over the past five years, starting at 24.33% in March 2020 and gradually decreasing to 16.45% by December 2021. However, from the beginning of 2022, the return on total capital has been on an upward trajectory, reaching 23.51% by December 2024.

This indicates that the company has been able to generate a higher return on the total capital employed in its operations in recent years, suggesting improved efficiency and profitability. The consistent improvement in the return on total capital since 2022 reflects positively on Federal Signal Corporation's ability to effectively utilize its capital to generate profits for its stakeholders.