Simulations Plus Inc (SLP)
Return on total capital
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 6,131 | 8,725 | 14,911 | 11,107 | 11,387 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 182,431 | 170,029 | 178,248 | 165,782 | 156,035 |
| Return on total capital | 3.36% | 5.13% | 8.37% | 6.70% | 7.30% |
August 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $6,131K ÷ ($—K + $182,431K)
= 3.36%
Simulations Plus Inc's return on total capital has shown a decreasing trend over the past five years, from 7.30% in 2020 to 3.36% in 2024. This indicates that the company's ability to generate profits from its total capital employed has weakened over time. A lower return on total capital may suggest inefficiencies in the company's operations or capital allocation strategies. It is important for the company to closely evaluate and address the factors contributing to this decline to improve its overall financial performance and efficiency in utilizing its capital resources.
Peer comparison
Aug 31, 2024