Stride Inc (LRN)

Return on total capital

		Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	249,600	229,868	213,754	197,538	165,499	157,649	146,044	134,886	156,628	131,919	109,878	91,415	110,456	96,110	72,056	63,909	32,457	28,097	36,865	39,850
Long-term debt	US$ in thousands	414,675	414,271	413,869	413,452	413,035	412,638	412,260	411,848	411,438	411,047	410,674	410,269	299,271	295,388	291,624	287,811	—	—	—	—
Total stockholders’ equity	US$ in thousands	1,176,020	1,103,210	1,032,680	958,493	947,296	899,361	841,899	786,823	812,581	780,570	734,233	719,906	804,648	786,779	752,429	719,021	675,329	664,628	651,096	624,712
Return on total capital		15.69%	15.15%	14.78%	14.40%	12.17%	12.02%	11.64%	11.25%	12.80%	11.07%	9.60%	8.09%	10.01%	8.88%	6.90%	6.35%	4.81%	4.23%	5.66%	6.38%

June 30, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $249,600K ÷ ($414,675K + $1,176,020K)
= 15.69%

The return on total capital for Stride Inc has shown a generally positive trend over the past quarters, indicating an improvement in the company's ability to generate returns relative to its total capital employed. The return on total capital increased from 6.38% in the first quarter of 2020 to 15.69% in the second quarter of 2024, suggesting a significant enhancement in the company's capital efficiency.

The consistent increase in the return on total capital demonstrates improved operational efficiency and effective utilization of the company's capital resources. This signifies that Stride Inc has been able to generate higher returns on the total capital invested in the business across the analyzed periods.

A higher return on total capital indicates that the company is effectively deploying its capital to generate profits, which is essential for creating long-term shareholder value. The upward trend in the return on total capital reflects positively on Stride Inc's financial performance and management effectiveness in utilizing its capital base.