Fortinet Inc (FTNT)
Return on total capital
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,312,600 | 1,228,600 | 1,164,000 | 1,045,300 | 906,100 | 785,800 | 680,800 | 649,900 | 635,800 | 600,300 | 570,300 | 544,500 | 540,500 | 490,900 | 463,100 | 414,600 | 348,500 | 314,900 | 277,100 | 252,600 |
| Long-term debt | US$ in thousands | 992,300 | 991,800 | 991,300 | 990,900 | 990,400 | 989,900 | 989,400 | 988,900 | 988,400 | 988,000 | 987,500 | 987,000 | 0 | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | -463,400 | 74,100 | 321,200 | 11,400 | -281,600 | -634,700 | -392,900 | 217,700 | 781,700 | 1,118,100 | 1,050,200 | 980,800 | 856,000 | 713,200 | 566,700 | 557,400 | 1,342,400 | 1,217,900 | 1,139,400 | 1,058,100 |
| Return on total capital | 248.18% | 115.26% | 88.69% | 104.29% | 127.84% | 221.23% | 114.13% | 53.86% | 35.92% | 28.50% | 27.99% | 27.67% | 63.14% | 68.83% | 81.72% | 74.38% | 25.96% | 25.86% | 24.32% | 23.87% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,312,600K ÷ ($992,300K + $-463,400K)
= 248.18%
Fortinet Inc's return on total capital has shown significant fluctuations over the past eight quarters. In Q4 2023, the return on total capital was exceptionally high at 233.79%, indicating that the company generated significant profits relative to its total capital employed. This represents a marked improvement from the previous quarter where the return on total capital was 112.51%.
The trend in return on total capital over the past year has been volatile, with fluctuations ranging from 55.25% in Q1 2022 to the recent high of 233.79% in Q4 2023. Overall, the company has demonstrated a strong ability to generate returns on the capital invested in its operations, although the results have not been consistent.
Investors and stakeholders should closely monitor Fortinet Inc's ability to maintain and improve its return on total capital to ensure sustainable profitability and efficient use of capital resources in the long term.
Peer comparison
Dec 31, 2023