The Gap, Inc. (GAP)
Return on total capital
| Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,224,000 | 1,175,000 | 1,069,000 | 872,000 | 646,000 | 386,000 | 298,000 | 148,000 | -51,000 | -23,000 | -384,000 | 53,000 | 490,000 | 617,000 | 964,000 | 571,000 | -910,000 | -1,283,000 | -1,231,000 | -958,000 |
| Long-term debt | US$ in thousands | 1,490,000 | 1,489,000 | 1,489,000 | 1,489,000 | 1,488,000 | 1,488,000 | 1,487,000 | 1,487,000 | 1,486,000 | 1,486,000 | 1,485,000 | 1,485,000 | 1,484,000 | 1,484,000 | 2,220,000 | 2,218,000 | 2,216,000 | 2,214,000 | 2,212,000 | 1,250,000 |
| Total stockholders’ equity | US$ in thousands | 3,264,000 | 3,135,000 | 2,901,000 | 2,707,000 | 2,595,000 | 2,460,000 | 2,263,000 | 2,185,000 | 2,233,000 | 2,571,000 | 2,305,000 | 2,454,000 | 2,722,000 | 2,787,000 | 3,020,000 | 2,806,000 | 2,614,000 | 2,371,000 | 2,253,000 | 2,317,000 |
| Return on total capital | 25.75% | 25.41% | 24.35% | 20.78% | 15.82% | 9.78% | 7.95% | 4.03% | -1.37% | -0.57% | -10.13% | 1.35% | 11.65% | 14.45% | 18.40% | 11.37% | -18.84% | -27.98% | -27.57% | -26.86% |
February 1, 2025 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,224,000K ÷ ($1,490,000K + $3,264,000K)
= 25.75%
The return on total capital for The Gap, Inc. has shown fluctuations over the reported periods. From May 2, 2020, to August 1, 2020, the company experienced negative returns, indicating challenges in generating profits relative to its total capital. However, there was a slight improvement by May 1, 2021, with a positive return of 11.37%, which continued to increase in the subsequent periods.
The return on total capital peaked at 25.75% on February 1, 2025, indicating efficient utilization of the company's total capital to generate profits. This upward trend in performance suggests improved financial health and operational efficiency within the organization.
Overall, the positive trend in return on total capital indicates that The Gap, Inc. has been able to effectively generate returns on the capital invested in the business, showcasing potential for continued growth and profitability.
Peer comparison
Feb 1, 2025