Movado Group Inc (MOV)
Return on total capital
| Jan 31, 2024 | Jan 31, 2023 | Jan 31, 2022 | Jan 31, 2021 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 59,869 | 119,928 | 117,061 | -140,747 | 58,753 |
| Long-term debt | US$ in thousands | — | — | — | 21,230 | 51,910 |
| Total stockholders’ equity | US$ in thousands | 516,798 | 507,606 | 472,808 | 425,264 | 526,537 |
| Return on total capital | 11.58% | 23.63% | 24.76% | -31.52% | 10.16% |
January 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $59,869K ÷ ($—K + $516,798K)
= 11.58%
Movado Group Inc's return on total capital has fluctuated over the past five fiscal years. In January 2020, the company experienced a return on total capital of 10.16%, which increased significantly to 24.76% in January 2022, indicating improved efficiency in generating profits relative to the total capital employed. However, the return on total capital decreased to 11.58% in January 2024, suggesting a decline in profitability compared to the previous year. It is essential for the company to assess the factors influencing these fluctuations and implement strategic measures to enhance its return on total capital in the future.