L3Harris Technologies Inc (LHX)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,426,000 | 1,826,000 | 2,774,000 | 1,623,000 | 1,278,000 |
| Long-term debt | US$ in thousands | 11,160,000 | 6,225,000 | 7,048,000 | 6,943,000 | 2,763,000 |
| Total stockholders’ equity | US$ in thousands | 18,765,000 | 18,523,000 | 19,213,000 | 20,724,000 | 3,363,000 |
| Return on total capital | 4.77% | 7.38% | 10.56% | 5.87% | 20.86% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,426,000K ÷ ($11,160,000K + $18,765,000K)
= 4.77%
L3Harris Technologies Inc's return on total capital has shown a declining trend over the period from December 31, 2019, to December 31, 2023. The return on total capital decreased from 20.86% in June 2019 to 4.77% in December 2023. This decline indicates that the company may be generating lower returns relative to the capital employed in its operations.
The decrease in return on total capital could be attributed to various factors such as changes in profitability, increasing capital investments, or inefficiencies in capital utilization. Investors and stakeholders may need to closely monitor these trends to assess the company's efficiency in generating returns from its total capital base.
Overall, the declining trend in return on total capital for L3Harris Technologies Inc raises concerns about the company's ability to effectively utilize its capital resources to generate profitable returns for its investors.
Peer comparison
Dec 31, 2023