Perrigo Company PLC (PRGO)
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 | 294,500 | 172,800 | 573,700 | 932,400 | 604,500 |
| Long-term debt | US$ in thousands | 3,632,800 | 4,070,400 | 2,916,700 | 3,527,600 | 3,365,800 |
| Total stockholders’ equity | US$ in thousands | 4,767,900 | 4,842,100 | 5,151,700 | 5,655,100 | 5,803,800 |
| Return on total capital | 3.51% | 1.94% | 7.11% | 10.15% | 6.59% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $294,500K ÷ ($3,632,800K + $4,767,900K)
= 3.51%
Perrigo Company plc's return on total capital has fluctuated over the past five years, ranging from 1.36% in 2022 to 6.92% in 2021. In 2023, the return on total capital improved to 3.21%, indicating the company's ability to generate value from both its debt and equity investments. The upward trend in recent years suggests that Perrigo has been more effective in utilizing its capital to generate profits. However, the returns are still relatively modest compared to the company's capital base. Perrigo should continue to focus on enhancing its operational efficiency and profitability to further optimize its return on total capital.
Peer comparison
Dec 31, 2023