RXO Inc. (RXO)
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 | -274,000 | 36,000 | 123,000 | 196,000 | 84,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,612,000 | 594,000 | 589,000 | 1,070,000 | 1,068,000 |
| Return on total capital | -17.00% | 6.06% | 20.88% | 18.32% | 7.87% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-274,000K ÷ ($—K + $1,612,000K)
= -17.00%
Based on the data provided, RXO Inc.'s return on total capital has fluctuated over the past five years. In December 2020, the return on total capital was 7.87%, which increased significantly to 18.32% by December 2021. The trend continued to improve in December 2022, reaching 20.88%.
However, in December 2023, there was a notable decline in the return on total capital to 6.06%. The most concerning observation is in December 2024, with a negative return on total capital of -17.00%. This sharp decline indicates that the company's capital may not have been utilized effectively during that period.
Overall, while there have been periods of strong performance in terms of return on total capital, there are also instances where the company's performance has deteriorated. It would be important for RXO Inc. to assess the factors contributing to these fluctuations and take appropriate actions to ensure consistent and sustainable returns on its total capital in the future.
Peer comparison
Dec 31, 2024