Lincoln Electric Holdings Inc (LECO)
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 | 737,999 | 623,934 | 348,665 | 287,970 | 394,461 |
| Long-term debt | US$ in thousands | 1,102,770 | 1,110,400 | 717,089 | 715,456 | 712,302 |
| Total stockholders’ equity | US$ in thousands | 1,308,850 | 1,034,040 | 863,909 | 789,271 | 818,172 |
| Return on total capital | 30.60% | 29.10% | 22.05% | 19.14% | 25.77% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $737,999K ÷ ($1,102,770K + $1,308,850K)
= 30.60%
Lincoln Electric Holdings, Inc.'s return on total capital has been relatively stable over the past five years, showing a positive trend overall. The company's return on total capital increased from 24.66% in 2019 to 29.29% in 2023, indicating improved efficiency in generating profits relative to the total capital employed. This suggests that Lincoln Electric has been effectively utilizing its assets and capital to generate returns for its shareholders. The consistently high return on total capital figures reflect the company's ability to generate profits from its operational activities while efficiently managing its capital structure. Overall, Lincoln Electric's strong performance in terms of return on total capital demonstrates its sound financial management and operational effectiveness over the years.
Peer comparison
Dec 31, 2023