ProPetro Holding Corp (PUMP)
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 | -161,429 | 120,810 | 165,473 | -67,823 | -132,117 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 816,273 | 998,392 | 954,033 | 826,302 | 870,771 |
| Return on total capital | -19.78% | 12.10% | 17.34% | -8.21% | -15.17% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-161,429K ÷ ($—K + $816,273K)
= -19.78%
ProPetro Holding Corp's return on total capital has fluctuated significantly over the past five years. The company experienced a negative return on total capital of -15.17% as of December 31, 2020, which improved to -8.21% by December 31, 2021. Subsequently, there was a notable positive turnaround, with returns increasing to 17.34% as of December 31, 2022, and further to 12.10% by December 31, 2023. However, the company's return on total capital declined sharply to -19.78% as of December 31, 2024.
The negative returns in 2020 and 2021 should raise concerns about the company's profitability and efficiency in utilizing its capital. The significant positive returns in 2022 and 2023 suggest improved performance and capital utilization, but the subsequent decline in 2024 is a red flag that may warrant further investigation.
Overall, the fluctuating trend in ProPetro Holding Corp's return on total capital indicates variability in the company's ability to generate profits relative to the capital employed in its operations. Investors and stakeholders should closely monitor future financial performance to assess the sustainability and consistency of the company's returns.
Peer comparison
Dec 31, 2024