Installed Building Products Inc (IBP)
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 | 370,100 | 344,881 | 188,317 | 161,468 | 120,709 |
| Long-term debt | US$ in thousands | 835,100 | 830,200 | 832,193 | 541,957 | 545,031 |
| Total stockholders’ equity | US$ in thousands | 670,300 | 493,500 | 416,840 | 319,182 | 250,031 |
| Return on total capital | 24.58% | 26.05% | 15.08% | 18.75% | 15.18% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $370,100K ÷ ($835,100K + $670,300K)
= 24.58%
Installed Building Products Inc's return on total capital has shown a fluctuating trend over the past five years. In 2023, the return on total capital was 23.86%, slightly lower than the previous year's figure of 24.15%. This indicates that the company generated $0.24 in profit for every dollar of total capital invested in the business.
Compared to 2021 and 2019, where the return on total capital was 14.62% and 14.68% respectively, the most recent figures demonstrate a significant improvement in the company's ability to generate returns on its capital. However, it is important to note that the return on total capital was higher in 2022 at 24.15%.
Overall, the consistent positive performance of return on total capital over the years reflects the company's efficient utilization of capital to generate profits. This indicates a favorable financial position and efficient management of resources by Installed Building Products Inc.
Peer comparison
Dec 31, 2023