Lear Corporation (LEA)

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	854,400	845,000	798,200	678,700	560,000	435,100	293,300	413,200	603,400	825,600	1,054,100	509,600	352,000	209,900	237,800	826,100	991,700	1,159,300	1,217,200	1,386,600
Long-term debt	US$ in thousands	2,464,500	2,750,000	2,750,000	2,600,000	2,600,000	2,600,000	2,600,000	2,600,000	2,868,600	2,306,300	2,310,900	2,315,600	2,633,300	2,299,800	2,302,700	2,306,800	2,293,700	2,339,000	2,339,000	1,965,600
Total stockholders’ equity	US$ in thousands	4,918,800	4,858,800	4,980,500	4,857,700	4,678,800	4,303,300	4,440,600	4,650,000	4,643,400	4,622,400	4,782,900	4,580,100	4,467,300	4,132,800	3,867,700	4,023,500	4,349,700	4,203,800	4,236,400	4,245,300
Return on total capital		11.57%	11.11%	10.33%	9.10%	7.69%	6.30%	4.17%	5.70%	8.03%	11.92%	14.86%	7.39%	4.96%	3.26%	3.85%	13.05%	14.93%	17.72%	18.51%	22.33%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $854,400K ÷ ($2,464,500K + $4,918,800K)
= 11.57%

Lear Corp.'s return on total capital has shown a positive trend over the past eight quarters. The return on total capital for Q4 2023 was 12.78%, an improvement from the previous quarter of 12.43% in Q3 2023. This indicates that the company is effectively utilizing its capital to generate returns for its stakeholders. Comparing the current return on total capital to the same quarter in the previous year, there has been a notable increase from 9.43% in Q4 2022 to 12.78% in Q4 2023, reflecting positive growth in profitability.

Overall, Lear Corp.'s return on total capital has demonstrated a consistent upward trajectory, with incremental improvements seen quarter over quarter. This positive trend suggests that the company is efficiently deploying its capital resources to generate profits and create value for its investors.