Patterson-UTI Energy Inc (PTEN)
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 | -889,737 | 360,314 | 208,118 | -675,269 | -890,248 |
| Long-term debt | US$ in thousands | 1,219,770 | 1,224,940 | 830,937 | 852,323 | 901,484 |
| Total stockholders’ equity | US$ in thousands | 3,465,820 | 4,812,290 | 1,665,520 | 1,609,490 | 2,016,060 |
| Return on total capital | -18.99% | 5.97% | 8.34% | -27.43% | -30.51% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-889,737K ÷ ($1,219,770K + $3,465,820K)
= -18.99%
Based on the provided data, Patterson-UTI Energy Inc's return on total capital exhibited fluctuations over the five-year period. The return on total capital was negative in 2020 and 2021, indicating that the company failed to generate satisfactory returns relative to its total capital employed in those years.
However, there was an improvement in the return on total capital in 2022 and 2023, reaching 8.34% and 5.97%, respectively. This suggests that the company was more efficient in utilizing its total capital to generate profits during these years.
Unfortunately, in 2024, the return on total capital declined significantly to -18.99%, indicating a decrease in the company's ability to generate returns on its total capital compared to the previous year.
Overall, the trend in Patterson-UTI Energy Inc's return on total capital shows variability, with periods of both improvement and decline. It is essential for the company to focus on enhancing its operational efficiency and profitability to ensure sustainable returns on its total capital in the future.
Peer comparison
Dec 31, 2024