PulteGroup Inc (PHM)
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 | 3,449,740 | 3,439,840 | 2,510,350 | 1,732,940 | 1,340,160 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 10,383,300 | 8,914,100 | 7,489,520 | 6,569,990 | 5,458,180 |
| Return on total capital | 33.22% | 38.59% | 33.52% | 26.38% | 24.55% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,449,740K ÷ ($—K + $10,383,300K)
= 33.22%
PulteGroup Inc's return on total capital has shown a positive trend over the past five years, indicating an improvement in the company's profitability and efficiency in utilizing its capital. The return on total capital increased from 15.57% in 2019 to 26.48% in 2023. This signifies that the company has been able to generate higher returns relative to the total capital employed in its operations.
The consistent growth in return on total capital from 2019 to 2023 suggests that PulteGroup Inc has been effectively managing its resources and investments to generate profits for its stakeholders. The significant increase from 2020 to 2021 followed by a slight decline in 2022 and 2023 may indicate fluctuations in the company's performance, which could potentially be influenced by various internal and external factors.
Overall, the upward trend in PulteGroup Inc's return on total capital reflects positively on the company's financial health and managerial effectiveness in delivering returns to its investors.
Peer comparison
Dec 31, 2023