Lennox International Inc (LII)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,032,500 | 789,200 | 654,500 | 585,100 | 472,700 |
| Long-term debt | US$ in thousands | — | — | 0 | 250,000 | 0 |
| Total stockholders’ equity | US$ in thousands | 850,200 | 285,300 | -203,100 | -269,000 | -17,100 |
| Return on total capital | 121.44% | 276.62% | — | — | — |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,032,500K ÷ ($—K + $850,200K)
= 121.44%
Return on total capital is a key financial ratio that indicates how efficiently a company is utilizing all of its capital to generate profits. In the case of Lennox International Inc, the return on total capital was not available for the years up to December 31, 2022. However, in December 31, 2023, the return on total capital was exceptionally high at 276.62%, indicating that the company generated significant profits relative to the total capital invested. This indicates strong financial performance and efficient capital allocation. By December 31, 2024, the return on total capital decreased to 121.44%, which is still a healthy level and suggests continued profitability. Overall, Lennox International Inc has demonstrated effective utilization of its total capital to generate returns for its stakeholders, although fluctuations in the ratio should be monitored for underlying changes in the business operations and financial health.
Peer comparison
Dec 31, 2024