Mueller Water Products (MWA)
Return on total capital
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 115,500 | 133,900 | 129,500 | 118,700 | 120,700 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 810,100 | 711,500 | 669,300 | 694,900 | 640,700 |
| Return on total capital | 14.26% | 18.82% | 19.35% | 17.08% | 18.84% |
September 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $115,500K ÷ ($—K + $810,100K)
= 14.26%
The analysis of Mueller Water Products' return on total capital over the period from September 30, 2020, to September 30, 2024, reveals significant fluctuations that reflect the company's evolving performance and financial efficiency.
In September 2020, the return on total capital was 18.84%, indicating a relatively strong ability to generate profits from its invested capital. This metric decreased slightly in the subsequent year, reaching 17.08% by September 2021, suggesting a marginal decline in efficiency or profitability in utilizing total capital.
The following year, September 2022, saw an improvement to 19.35%, exceeding the 2020 level and indicating a favorable turnaround or operational enhancements that enhanced the company's ability to leverage its total capital for profit generation.
However, by September 2023, the return slightly declined again to 18.82%, approaching the earlier levels but reflecting some softness in operational performance or increased capital costs.
Most notably, by September 2024, the return on total capital experienced a significant decline to 14.26%. This substantial drop suggests a deterioration in the company’s ability to generate profits from its total capital base, possibly due to increased costs, lower margins, or changes in operational efficiency.
Overall, the trend demonstrates a peak in performance during 2022, with subsequent declines highlighting potential challenges faced by Mueller Water Products in maintaining its previous profitability levels relative to its invested capital.
Peer comparison
Sep 30, 2024