Guess? Inc. (GES)
Return on total capital
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Feb 3, 2024 | Jan 31, 2024 | Oct 31, 2023 | Oct 28, 2023 | Jul 31, 2023 | Jul 29, 2023 | Apr 30, 2023 | Apr 29, 2023 | Jan 31, 2023 | Jan 28, 2023 | Oct 31, 2022 | Oct 29, 2022 | Jul 31, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 31, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 85,321 | 154,270 | 300,835 | 367,716 | 418,764 | 346,032 | 260,344 | 173,940 | 120,748 | 147,228 | 190,339 | 255,398 | 302,147 | 250,876 | 189,159 | 170,017 | 257,782 | 307,354 | 335,759 | 354,319 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,563,730 | 450,729 | 491,210 | 565,473 | 684,940 | 684,940 | 514,060 | 514,060 | 488,897 | 488,897 | 452,000 | 452,000 | 534,113 | 534,113 | 418,828 | 418,828 | 410,843 | 410,843 | 403,063 | 622,658 |
| Return on total capital | 5.46% | 34.23% | 61.24% | 65.03% | 61.14% | 50.52% | 50.64% | 33.84% | 24.70% | 30.11% | 42.11% | 56.50% | 56.57% | 46.97% | 45.16% | 40.59% | 62.74% | 74.81% | 83.30% | 56.90% |
January 31, 2025 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $85,321K ÷ ($—K + $1,563,730K)
= 5.46%
Guess? Inc.'s return on total capital has fluctuated over the periods provided. The ratio ranged from a high of 83.30% in April 2022 to a low of 5.46% in January 2025. The company experienced a significant decline in return on total capital from July 2023 to October 2024, showing a downward trend during this period. However, there was a slight improvement in the ratio in the subsequent periods.
The return on total capital is an important metric as it indicates how efficiently the company is utilizing its total capital to generate profits. A higher return on total capital suggests that the company is effectively using its resources to generate income for its stakeholders. Guess? Inc. should closely monitor this ratio to ensure sustained profitability and efficient capital allocation in the future.