Haverty Furniture Companies Inc (HVT)
Return on total capital
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 67,125 | 210,377 | 221,288 | 235,006 | 246,059 | 236,211 | 235,984 | 236,531 | 236,390 | 223,922 | 218,951 | 240,453 | 217,259 | 193,055 | 174,083 | 131,470 | 133,828 | 134,879 | 137,706 | 138,357 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 308,366 | 316,416 | 305,583 | 296,412 | 289,399 | 283,609 | 266,726 | 260,400 | 255,970 | 291,541 | 289,412 | 270,314 | 252,967 | 267,377 | 264,378 | 252,447 | 260,503 | 268,722 | 267,260 | 281,926 |
| Return on total capital | 21.77% | 66.49% | 72.42% | 79.28% | 85.02% | 83.29% | 88.47% | 90.83% | 92.35% | 76.81% | 75.65% | 88.95% | 85.88% | 72.20% | 65.85% | 52.08% | 51.37% | 50.19% | 51.53% | 49.08% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $67,125K ÷ ($—K + $308,366K)
= 21.77%
Haverty Furniture Cos., Inc. has demonstrated a declining trend in return on total capital over the past eight quarters, starting from 45.66% in Q1 2022 and dropping to 21.82% in Q4 2023. The company's return on total capital has decreased by approximately half during this period.
The decreasing trend in return on total capital indicates that the company may be facing challenges in generating profits relative to its total capital employed. A declining return on total capital could suggest inefficiencies in the company's operations or declining profitability.
Management should closely monitor the factors impacting return on total capital, such as operational efficiency, cost control, and capital allocation, in order to improve overall performance and ensure sustainable profitability in the long run. It is essential for Haverty Furniture Cos., Inc. to implement strategic measures to reverse this downward trend and enhance its return on total capital in the future.
Peer comparison
Dec 31, 2023