Ross Stores Inc (ROST)

Return on total capital

		Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	2,545,880	2,068,020	2,333,680	194,312	2,174,000
Long-term debt	US$ in thousands	2,211,020	2,456,510	2,452,320	2,448,180	312,891
Total stockholders’ equity	US$ in thousands	4,871,330	4,288,580	4,060,050	3,290,640	3,359,250
Return on total capital		35.95%	30.66%	35.83%	3.39%	59.20%

February 3, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,545,880K ÷ ($2,211,020K + $4,871,330K)
= 35.95%

Ross Stores Inc's return on total capital has fluctuated over the past five years, ranging from 3.39% in January 2021 to a high of 59.20% in February 2020. The return on total capital increased significantly in the most recent fiscal year ended February 3, 2024, reaching 35.95%. This indicates that the company has been able to generate a strong return relative to the total capital employed in its operations, reflecting efficient utilization of both debt and equity to generate profits. The improvement in return on total capital from the previous year suggests that Ross Stores Inc has effectively managed its capital structure and operations to enhance profitability. However, it is important to continue monitoring this ratio to ensure sustained performance and efficiency in capital allocation strategies.