General Motors Company (GM)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 9,298,000 | 10,315,000 | 9,324,000 | 12,322,000 | 11,924,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 64,286,000 | 67,792,000 | 59,744,000 | 45,030,000 | 41,792,000 |
| Return on total capital | 14.46% | 15.22% | 15.61% | 27.36% | 28.53% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $9,298,000K ÷ ($—K + $64,286,000K)
= 14.46%
General Motors Company's return on total capital has exhibited fluctuating trends over the past five years. The return on total capital decreased from 6.28% in 2021 to 4.72% in 2020, reflecting a decline in the company's ability to generate profits relative to its total capital employed. However, there was a modest increase to 6.11% in 2022, indicating a partial recovery. Nevertheless, in 2023, the return on total capital decreased to 5.26%, signifying a continued challenge in efficiently utilizing its total capital to generate returns. This trend suggests the need for General Motors to evaluate and potentially optimize the allocation and utilization of its capital resources to enhance profitability and create value for its stakeholders.
Peer comparison
Dec 31, 2023