Nordson Corporation (NDSN)
Return on total capital
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 674,001 | 674,844 | 671,692 | 599,667 | 333,649 |
| Long-term debt | US$ in thousands | 2,101,200 | 1,621,390 | 345,320 | 781,709 | 1,067,950 |
| Total stockholders’ equity | US$ in thousands | 2,932,190 | 2,598,060 | 2,294,380 | 2,159,130 | 1,758,990 |
| Return on total capital | 13.39% | 15.99% | 25.45% | 20.39% | 11.80% |
October 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $674,001K ÷ ($2,101,200K + $2,932,190K)
= 13.39%
Nordson Corporation's return on total capital has shown variability over the past five years, with figures ranging from 11.80% to 25.45%. The return on total capital was at its peak in 2022 at 25.45%, indicating efficient utilization of both debt and equity to generate profits. However, this figure declined in 2023 and 2024 to 15.99% and 13.39%, respectively. While the return on total capital in these years remained positive, the downward trend suggests a potential decrease in profitability or a decrease in the efficiency of capital deployment. Further analysis of the company's financial performance and capital structure is recommended to understand the factors influencing these fluctuations and identify areas for improvement in optimizing the return on total capital.
Peer comparison
Oct 31, 2024