Perrigo Company PLC (PRGO)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 107,100 | 165,500 | 168,600 | 603,400 | 277,100 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,319,400 | 4,767,900 | 4,842,100 | 5,151,700 | 5,655,100 |
| Return on total capital | 2.48% | 3.47% | 3.48% | 11.71% | 4.90% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $107,100K ÷ ($—K + $4,319,400K)
= 2.48%
Perrigo Company PLC's return on total capital has fluctuated over the past five years. In December 2020, the return on total capital was 4.90%, showing a moderate level of profitability. Subsequently, there was a significant improvement in December 2021, with the return on total capital increasing to 11.71%, indicating a substantial increase in efficiency in generating profits relative to the capital invested.
However, the following two years, December 2022 and December 2023, saw a decline in the return on total capital to 3.48% and 3.47% respectively. This suggests a decrease in profitability efficiency compared to the previous year. In December 2024, the return on total capital further decreased to 2.48%, indicating a continued decline in the company's ability to generate returns on its total capital.
Overall, Perrigo Company PLC's return on total capital has shown fluctuations, with a notable peak in 2021 followed by a decline in subsequent years. It will be essential for the company to assess and improve its operational efficiency and profitability to enhance its return on total capital in the future.
Peer comparison
Dec 31, 2024