MYR Group Inc (MYRG)
Return on total capital
| Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 51,650 | 58,713 | 69,440 | 121,459 | 124,879 | 124,752 | 120,107 | 114,577 | 112,529 | 106,282 | 109,927 | 112,888 | 115,462 | 110,575 | 115,450 | 105,799 | 94,429 | 99,808 | 80,771 | 70,352 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 600,360 | 588,509 | 633,342 | 663,720 | 651,202 | 625,459 | 604,300 | 577,565 | 560,200 | 535,877 | 531,082 | 536,278 | 519,102 | 496,176 | 471,625 | 448,460 | 429,288 | 408,600 | 389,446 | 374,982 |
| Return on total capital | 8.60% | 9.98% | 10.96% | 18.30% | 19.18% | 19.95% | 19.88% | 19.84% | 20.09% | 19.83% | 20.70% | 21.05% | 22.24% | 22.29% | 24.48% | 23.59% | 22.00% | 24.43% | 20.74% | 18.76% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $51,650K ÷ ($—K + $600,360K)
= 8.60%
Return on total capital is a key financial ratio that measures a company's ability to generate profits from its total capital employed, including both debt and equity. Over the observed period for MYR Group Inc, the return on total capital showed fluctuating trends. From March 31, 2020, to June 30, 2021, the return on total capital improved steadily, reaching its peak at 24.48% on June 30, 2021.
However, from September 30, 2021, the return on total capital started to decline gradually before experiencing a sharper decrease from June 30, 2024, to December 31, 2024. This decline indicates that MYR Group Inc may be facing challenges in maintaining or improving its efficiency in generating profits with the capital at its disposal.
Overall, a sustained high return on total capital is desirable as it indicates effective capital utilization and profitability. The decreasing trend observed from mid-2021 to the end of 2024 suggests a need for closer examination of the company's capital allocation strategies and operational efficiency to enhance long-term financial performance.
Peer comparison
Dec 31, 2024