PriceSmart Inc (PSMT)

Return on total capital

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	196,572	187,112	180,176	185,001	172,493	170,168	166,003	159,301	161,678	158,669	154,142	153,124	141,930	136,893	123,498	125,500	124,976	121,498	114,690	109,873
Long-term debt	US$ in thousands	102,350	99,704	119,487	124,631	126,383	118,505	103,556	108,182	120,057	110,601	110,110	101,294	106,160	108,104	112,610	117,045	113,879	98,084	63,711	69,476
Total stockholders’ equity	US$ in thousands	1,093,870	1,082,240	1,107,040	1,089,690	1,043,910	1,026,360	991,073	968,198	953,884	942,146	915,345	898,803	874,268	866,167	831,719	818,666	817,893	816,829	797,351	778,593
Return on total capital		16.43%	15.83%	14.69%	15.23%	14.74%	14.86%	15.17%	14.80%	15.05%	15.07%	15.03%	15.31%	14.48%	14.05%	13.08%	13.41%	13.41%	13.28%	13.32%	12.96%

February 29, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $196,572K ÷ ($102,350K + $1,093,870K)
= 16.43%

PriceSmart Inc's return on total capital has shown a relatively stable performance over the analyzed periods, ranging from a low of 12.96% to a high of 16.43%. The company's ability to generate returns on the total capital employed in its operations has been consistently above 13% in recent periods. This indicates that PriceSmart is effectively utilizing its capital resources to generate profits.

The average return on total capital for the periods analyzed is approximately 14.87%, suggesting that the company has been able to efficiently generate profits relative to the total capital invested in the business. Investors and stakeholders may view this as a positive sign of the company's financial health and operational efficiency. However, it should be noted that fluctuations in economic conditions or shifts in the competitive landscape could impact PriceSmart's ability to maintain this level of return on total capital in the future.