Resideo Technologies Inc (REZI)
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 | 302,000 | 420,000 | 685,000 | 569,000 | 164,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 3,309,000 | 2,749,000 | 2,529,000 | 2,252,000 | 1,993,000 |
| Return on total capital | 9.13% | 15.28% | 27.09% | 25.27% | 8.23% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $302,000K ÷ ($—K + $3,309,000K)
= 9.13%
Based on the data provided, Resideo Technologies Inc's return on total capital has shown variability over the past five years. In 2020, the return on total capital was 8.23%, indicating that the company generated a return of 8.23% on the total capital employed in its operations.
Subsequently, there was a significant improvement in this metric as the return on total capital rose to 25.27% in 2021 and further increased to 27.09% in 2022, suggesting that the company was able to utilize its capital more efficiently to generate higher returns.
However, in 2023, there was a decline in the return on total capital to 15.28%, indicating a potential decrease in the company's ability to generate returns on its total capital compared to the previous year.
By the end of 2024, the return on total capital further decreased to 9.13%, signifying a downturn in the company's efficiency in generating returns on the total capital employed.
Overall, the fluctuations in Resideo Technologies Inc's return on total capital over the five-year period indicate varying levels of capital efficiency and performance, which may necessitate further analysis of the company's operations and strategies to sustain or improve its return on total capital in the future.