Select Medical Holdings (SEM)
Return on total capital
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 304,885 | 648,741 | 607,306 | 619,032 | 574,657 | 545,822 | 515,898 | 473,327 | 422,696 | 403,743 | 452,718 | 511,465 | 618,763 | 678,232 | 686,998 | 565,647 | 477,645 | 462,869 | 428,483 | 496,229 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,986,930 | 1,915,190 | 1,416,590 | 1,367,280 | 1,288,300 | 1,523,390 | 1,246,040 | 1,418,440 | 1,317,530 | 1,105,600 | 1,071,410 | 1,138,140 | 1,325,900 | 1,145,500 | 1,234,220 | 1,145,980 | 1,060,480 | 1,038,590 | 992,883 | 808,638 |
| Return on total capital | 15.34% | 33.87% | 42.87% | 45.27% | 44.61% | 35.83% | 41.40% | 33.37% | 32.08% | 36.52% | 42.25% | 44.94% | 46.67% | 59.21% | 55.66% | 49.36% | 45.04% | 44.57% | 43.16% | 61.37% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $304,885K ÷ ($—K + $1,986,930K)
= 15.34%
Select Medical Holdings' return on total capital has shown some fluctuation over the past few years. The company's return on total capital stood at 61.37% as of March 31, 2020, indicating strong efficiency in generating profits relative to the total capital employed. This rate declined to 15.34% by December 31, 2024, reflecting a significant decrease in profitability efficiency.
The trend in return on total capital shows a peak around mid-2021, with values above 50%, suggesting a period of heightened profitability relative to capital investment. However, the ratio began to decrease steadily after that peak, reaching 15.34% by the end of 2024.
The declining trend in return on total capital may indicate a decrease in the company's ability to generate profits from its capital investments. It is important for management to closely monitor and assess factors impacting profitability efficiency to potentially reverse this trend and enhance long-term financial performance.
Peer comparison
Dec 31, 2024