Garmin Ltd (GRMN)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,593,990 | 1,092,160 | 1,027,840 | 1,218,620 | 1,054,240 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 7,848,400 | 7,012,060 | 6,204,340 | 6,114,160 | 5,516,120 |
| Return on total capital | 20.31% | 15.58% | 16.57% | 19.93% | 19.11% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,593,990K ÷ ($—K + $7,848,400K)
= 20.31%
To analyze Garmin Ltd's return on total capital based on the provided data, we observe the following trend:
- In December 31, 2020, Garmin's return on total capital stood at 19.11%, indicating the company generated $0.19 in profit for every dollar of total capital employed.
- By December 31, 2021, the return on total capital had slightly improved to 19.93%, showcasing continued efficiency in capital deployment.
- However, in the subsequent years, there was a decline in the return on total capital. By December 31, 2022, the return dropped to 16.57%, suggesting a potential decrease in profitability or less effective utilization of capital.
- This trend continued into December 31, 2023, where the return on total capital further decreased to 15.58%.
- The most recent data point, as of December 31, 2024, shows an improvement in the return on total capital to 20.31%, potentially indicating a rebound in profitability or better capital management strategies.
Overall, the varying return on total capital figures suggest fluctuations in Garmin Ltd's ability to generate profits relative to the total capital employed in the business. It would be essential for stakeholders to further investigate the reasons behind these fluctuations to assess the company's operational efficiency and financial health effectively.
Peer comparison
Dec 31, 2024