Service Corporation International (SCI)
Return on total capital
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 947,709 | 874,345 | 853,156 | 836,977 | 927,041 | 1,055,899 | 1,166,496 | 1,189,264 | 1,195,797 | 1,181,594 | 1,074,605 | 1,016,868 | 824,893 | 778,871 | 692,851 | 652,622 | 650,100 | 717,803 | 696,647 | 685,155 |
| Long-term debt | US$ in thousands | 4,649,160 | 4,511,530 | 4,452,370 | 4,327,790 | 4,251,080 | 4,127,410 | 3,954,480 | 3,962,940 | 3,901,300 | 3,759,970 | 3,772,450 | 3,439,100 | 3,514,180 | 3,584,510 | 3,573,710 | 3,535,750 | 3,513,530 | 3,466,770 | 3,464,900 | 3,409,200 |
| Total stockholders’ equity | US$ in thousands | 1,541,260 | 1,630,430 | 1,645,140 | 1,621,710 | 1,673,190 | 1,677,200 | 1,839,350 | 1,842,750 | 1,909,440 | 1,941,900 | 1,918,140 | 1,850,710 | 1,752,750 | 1,743,070 | 1,754,280 | 1,751,090 | 1,823,310 | 1,775,490 | 1,744,230 | 1,700,450 |
| Return on total capital | 15.31% | 14.24% | 13.99% | 14.07% | 15.65% | 18.19% | 20.13% | 20.48% | 20.58% | 20.72% | 18.88% | 19.22% | 15.66% | 14.62% | 13.00% | 12.34% | 12.18% | 13.69% | 13.37% | 13.41% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $947,709K ÷ ($4,649,160K + $1,541,260K)
= 15.31%
Service Corp. International's return on total capital has shown a declining trend over the past eight quarters, starting at 19.76% in Q1 2022 and dropping to 14.86% in Q4 2023. This indicates that the company's ability to generate returns from its total capital has weakened over time. The highest return was recorded in Q2 2022 at 19.76%, followed by a slight decrease in the following quarters. However, the return saw a more significant decline in Q3 and Q4 2023.
The decreasing trend in return on total capital could be a cause for concern as it may suggest inefficiencies in the utilization of the company's capital resources. Investors and management should closely monitor this metric to ensure that the company is effectively deploying its capital to generate profitable returns. Additionally, further analysis of the factors influencing this trend, such as changes in profitability, efficiency, or capital structure, may be warranted to address any underlying issues impacting the company's return on total capital.
Peer comparison
Dec 31, 2023