HP Inc (HPQ)
Return on total capital
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 3,818,000 | 3,456,000 | 4,559,000 | 5,359,000 | 3,462,000 |
| Long-term debt | US$ in thousands | 8,263,000 | 9,254,000 | 10,796,000 | 6,386,000 | 5,543,000 |
| Total stockholders’ equity | US$ in thousands | -1,323,000 | -1,069,000 | -3,025,000 | -1,644,000 | -2,275,000 |
| Return on total capital | 55.01% | 42.22% | 58.67% | 113.01% | 105.94% |
October 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,818,000K ÷ ($8,263,000K + $-1,323,000K)
= 55.01%
HP Inc's return on total capital has fluctuated over the past five years, ranging from a low of 42.22% in October 2023 to a high of 113.01% in October 2021. This metric measures the efficiency of the company in generating profits from its invested capital, considering both debt and equity. The return on total capital was notably high in the last two years, indicating strong profitability relative to the capital employed. However, the decrease from 113.01% in 2021 to 55.01% in 2024 suggests a decline in the company's ability to generate returns from its total capital in the most recent period. Further analysis is warranted to understand the factors driving this fluctuation and assess the company's overall financial performance.
Peer comparison
Oct 31, 2024