Dave & Buster’s Entertainment (PLAY)

Return on total capital

Feb 4, 2024 Oct 29, 2023 Jul 30, 2023 Apr 30, 2023 Jan 29, 2023 Oct 30, 2022 Jul 31, 2022 May 1, 2022 Jan 30, 2022 Oct 31, 2021 Aug 1, 2021 May 2, 2021 Jan 31, 2021 Nov 1, 2020 Aug 2, 2020 May 3, 2020 Feb 2, 2020 Nov 3, 2019 Aug 4, 2019 May 5, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 306,600 294,308 305,808 285,208 262,508 231,849 226,218 248,885 187,181 86,591 5,175 -155,107 -253,516 -161,859 -98,413 28,916 148,079 151,457 160,430 160,146
Long-term debt US$ in thousands 1,284,000 1,281,300 1,278,700 1,221,100 1,222,700 1,222,210 1,219,680 431,966 431,395 484,677 537,816 537,102 596,388 561,815 731,646 735,261 632,689 640,384 552,079 427,774
Total stockholders’ equity US$ in thousands 251,200 211,600 314,400 359,900 410,500 361,000 356,400 351,800 275,500 246,559 229,875 178,642 153,232 206,774 250,371 192,635 169,650 148,121 249,302 360,125
Return on total capital 19.97% 19.71% 19.20% 18.04% 16.07% 14.64% 14.35% 31.76% 26.48% 11.84% 0.67% -21.67% -33.82% -21.06% -10.02% 3.12% 18.46% 19.21% 20.02% 20.33%

February 4, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $306,600K ÷ ($1,284,000K + $251,200K)
= 19.97%

Dave & Buster’s Entertainment has shown a fluctuating trend in its return on total capital over the past several quarters. The return on total capital has ranged from a low of -33.82% to a high of 31.76% during the period under review. In recent quarters, there has been an improvement in the return on total capital, with the latest figure reported at 19.97%. This indicates that for every dollar of capital invested in the company, it generated a return of approximately 19.97%.

The return on total capital is an important measure of a company's profitability and efficiency in generating returns for both debt and equity investors. A higher return on total capital is generally seen as favorable, indicating that the company is effectively utilizing its capital to generate profits. On the other hand, a lower return on total capital may signal inefficiencies or challenges in the company's operations.

It is important for investors and analysts to closely monitor the return on total capital over time to assess the company's performance and financial health. Dave & Buster’s Entertainment's management should continue to focus on improving this metric to drive long-term value creation for shareholders and stakeholders.