Pure Storage Inc (PSTG)
Return on total capital
| Feb 4, 2024 | Nov 5, 2023 | Aug 6, 2023 | Feb 5, 2023 | Nov 6, 2022 | Aug 7, 2022 | May 8, 2022 | Feb 6, 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 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 239,187 | 173,783 | 108,243 | 96,557 | 43,788 | 19,424 | -28,860 | -91,819 | -161,904 | -207,088 | -229,836 | -238,757 | -192,787 | -151,849 | -155,342 | -166,769 | -190,583 | -192,809 | -186,856 | -155,658 |
| Long-term debt | US$ in thousands | 100,000 | 100,000 | 100,000 | 0 | 0 | 0 | 0 | 786,779 | 778,366 | 770,662 | 763,064 | 755,814 | 748,422 | — | — | 477,007 | 470,014 | 463,118 | 456,318 | 449,828 |
| Total stockholders’ equity | US$ in thousands | 1,270,090 | 1,148,460 | 986,328 | 941,233 | 840,508 | 761,358 | 727,094 | 754,336 | 724,424 | 697,444 | 715,473 | 750,006 | 735,081 | 746,106 | 756,858 | 830,118 | 777,950 | 737,539 | 743,976 | 737,780 |
| Return on total capital | 17.46% | 13.92% | 9.96% | 10.26% | 5.21% | 2.55% | -3.97% | -5.96% | -10.77% | -14.11% | -15.54% | -15.86% | -13.00% | -20.35% | -20.52% | -12.76% | -15.27% | -16.06% | -15.57% | -13.11% |
February 4, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $239,187K ÷ ($100,000K + $1,270,090K)
= 17.46%
The return on total capital for Pure Storage Inc has shown variability over the past few quarters. The ratio has ranged from a low of -20.52% to a high of 17.46%. It indicates how efficiently the company is utilizing its capital to generate profits.
The trend in the return on total capital shows improvement, with the ratio increasing from negative figures to positive figures over the recent quarters. This signifies a better utilization of the company's total capital to generate returns for its shareholders.
Overall, the company seems to be making progress in optimizing its capital efficiency, as indicated by the increasing trend in the return on total capital ratio. However, it is important to continue monitoring this ratio to ensure sustained improvement in capital utilization and profitability.
Peer comparison
Feb 4, 2024