Merit Medical Systems Inc (MMSI)

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	127,600	88,968	59,178	-3,237	14,606
Long-term debt	US$ in thousands	823,013	186,759	234,397	343,722	431,984
Total stockholders’ equity	US$ in thousands	1,202,000	1,144,400	1,039,800	958,575	949,944
Return on total capital		6.30%	6.68%	4.64%	-0.25%	1.06%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $127,600K ÷ ($823,013K + $1,202,000K)
= 6.30%

The return on total capital for Merit Medical Systems, Inc. has shown a positive trend over the past five years, increasing from 2.84% in 2019 to 6.29% in 2023. This indicates that the company has been able to generate a higher return relative to the total capital employed in its operations over the years.

The consistent improvement in return on total capital reflects the company's effective utilization of its capital resources to generate profits. This implies that Merit Medical Systems, Inc. has been able to efficiently allocate its financial resources and manage its operations to enhance profitability.

The increase in return on total capital from 2020 to 2023 suggests a strengthening financial performance, which may indicate improved operational efficiency, better cost management, or increased revenue generation. This positive trend in returns indicates that the company's financial health and operational performance have been progressing in a favorable direction over the years.

Overall, the upward trajectory of Merit Medical Systems, Inc.'s return on total capital over the five-year period signals a positive outlook for the company in terms of its ability to generate returns on the capital invested in its business activities.