Ovintiv Inc (OVV)
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 | 2,865,000 | 3,871,000 | 1,579,000 | -5,359,000 | 697,000 |
| Long-term debt | US$ in thousands | 5,453,000 | 3,177,000 | 4,786,000 | 6,367,000 | 6,974,000 |
| Total stockholders’ equity | US$ in thousands | 10,370,000 | 7,689,000 | 5,074,000 | 3,837,000 | 9,930,000 |
| Return on total capital | 18.11% | 35.62% | 16.01% | -52.52% | 4.12% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,865,000K ÷ ($5,453,000K + $10,370,000K)
= 18.11%
Ovintiv Inc's return on total capital has fluctuated over the past five years, ranging from as low as 1.02% in 2020 to as high as 33.26% in 2022. The return on total capital decreased significantly in 2020 compared to the previous years before rebounding in the following years. In 2023, the return on total capital stood at 17.26%, indicating that the company's ability to generate profits from its total capital employed improved compared to 2021 and 2020 but was lower than the exceptional performance in 2022. Overall, the trend in return on total capital reflects fluctuations in the company's operational efficiency and profitability over the years.
Peer comparison
Dec 31, 2023