Halliburton Company (HAL)
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 | 3,822,000 | 4,083,000 | 2,707,000 | 1,800,000 | -2,436,000 |
| Long-term debt | US$ in thousands | 7,541,000 | 7,636,000 | 7,928,000 | 9,127,000 | 9,132,000 |
| Total stockholders’ equity | US$ in thousands | 10,506,000 | 9,391,000 | 7,948,000 | 6,713,000 | 4,974,000 |
| Return on total capital | 21.18% | 23.98% | 17.05% | 11.36% | -17.27% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,822,000K ÷ ($7,541,000K + $10,506,000K)
= 21.18%
The return on total capital for Halliburton Company has shown a significant improvement over the years. Starting at a negative figure of -17.27% on December 31, 2020, the company managed to turn around its performance to achieve positive returns of 11.36% by December 31, 2021. Subsequently, the return on total capital continued to increase, reaching 17.05% by December 31, 2022, and showing further growth to 23.98% by December 31, 2023. However, in the following year, there was a slight decrease in the return on total capital to 21.18% by December 31, 2024.
Overall, the upward trend in the return on total capital indicates that Halliburton Company has been effectively utilizing its total capital to generate returns for its stakeholders. It is essential for stakeholders to closely monitor this ratio to assess the company's efficiency in generating profits relative to the total capital employed.
Peer comparison
Dec 31, 2024