NiSource Inc (NI)
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 | 1,343,400 | 1,330,300 | 1,043,800 | 336,000 | 885,500 |
| Long-term debt | US$ in thousands | 10,370,900 | 8,479,400 | 10,415,700 | 11,034,200 | 8,764,400 |
| Total stockholders’ equity | US$ in thousands | 8,269,600 | 7,575,400 | 6,947,300 | 5,752,200 | 5,986,700 |
| Return on total capital | 7.21% | 8.29% | 6.01% | 2.00% | 6.00% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,343,400K ÷ ($10,370,900K + $8,269,600K)
= 7.21%
NiSource Inc's return on total capital has shown some fluctuations over the past five years. In 2023, the return on total capital was 5.80%, a slight decrease from the previous year's 6.15%. This downward trend is consistent with the company's performance in 2021, where the return on total capital was 6.06%.
Comparing these figures to the higher returns in 2020 (6.20%) and 2019 (8.35%), it suggests a declining trend in the company's ability to generate returns from its total capital base. This could be concerning for investors and stakeholders, as a lower return on total capital may indicate inefficiencies in the company's capital allocation or operational performance.
Further analysis and investigation into the reasons behind the fluctuating returns on total capital for NiSource Inc would be necessary to understand the underlying factors driving these changes and to identify potential areas for improvement.
Peer comparison
Dec 31, 2023