Graham Holdings Co (GHC)
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 | 1,184,211 | 485,690 | 472,333 | 573,307 | 471,562 | 409,591 | 368,468 | 118,765 | 175,867 | 241,994 | 226,952 | 465,271 | 484,201 | 705,183 | 775,591 | 677,604 | 427,261 | 285,819 | 237,375 | 250,766 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,256,660 | 4,004,300 | 3,968,090 | 4,043,490 | 3,975,740 | 3,688,500 | 3,809,480 | 3,747,220 | 3,731,380 | 4,259,710 | 4,308,690 | 4,460,160 | 4,399,580 | 3,963,840 | 3,968,090 | 3,857,620 | 3,759,300 | 3,239,810 | 3,206,670 | 3,206,060 |
| Return on total capital | 27.82% | 12.13% | 11.90% | 14.18% | 11.86% | 11.10% | 9.67% | 3.17% | 4.71% | 5.68% | 5.27% | 10.43% | 11.01% | 17.79% | 19.55% | 17.57% | 11.37% | 8.82% | 7.40% | 7.82% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,184,211K ÷ ($—K + $4,256,660K)
= 27.82%
Return on total capital is a key financial ratio that indicates the efficiency and profitability of Graham Holdings Co in generating returns from its total capital employed.
The return on total capital for Graham Holdings Co fluctuated over the observed period, ranging from a low of 3.17% on March 31, 2023, to a high of 27.82% on December 31, 2024. The trend shows some variability, with peaks and troughs across the quarters.
There was a significant improvement in the return on total capital from March 31, 2021, to June 30, 2021, where the ratio jumped from 17.57% to 19.55%. This indicates a period of increased efficiency and profitability in utilizing the company's capital.
In contrast, the return on total capital declined notably from June 30, 2022, to September 30, 2022, dropping from 5.27% to 5.68%. This decrease suggests a potential decrease in the company's ability to generate returns from its total capital during that period.
Overall, analyzing the return on total capital helps assess Graham Holdings Co's ability to deploy its capital effectively and generate optimal returns for its shareholders. It is essential for investors and analysts to monitor this ratio to gauge the company's financial performance and efficiency in capital utilization over time.
Peer comparison
Dec 31, 2024