Semtech Corporation (SMTC)
Return on total capital
| Jan 31, 2025 | Jan 31, 2024 | Jan 28, 2024 | Jan 31, 2023 | Jan 29, 2023 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 70,900 | -935,553 | -945,698 | 93,924 | 96,370 |
| Long-term debt | US$ in thousands | — | — | 1,371,040 | — | 1,296,970 |
| Total stockholders’ equity | US$ in thousands | 542,400 | -307,434 | -307,434 | 755,852 | 755,852 |
| Return on total capital | 13.07% | — | -88.91% | 12.43% | 4.69% |
January 31, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $70,900K ÷ ($—K + $542,400K)
= 13.07%
To analyze Semtech Corporation's return on total capital over the specified periods:
1. January 29, 2023: The return on total capital was 4.69%. This indicates that for every dollar of total capital invested, the company generated a return of 4.69% during this period.
2. January 31, 2023: The return on total capital improved significantly to 12.43%, reflecting better efficiency in utilizing the total capital to generate returns.
3. January 28, 2024: The return on total capital was negative at -88.91%. A negative return signifies that the company's investments did not yield sufficient returns to cover the cost of capital during this period.
4. January 31, 2024: The return on total capital is not available (marked as "—"), suggesting a lack of data or a reporting issue for this period.
5. January 31, 2025: The return on total capital increased to 13.07%, indicating a positive trend where the company improved its ability to generate returns on the total capital invested.
In summary, Semtech Corporation experienced fluctuating returns on total capital over the analyzed periods, with improvements in some years and negative returns in others. The company should further investigate the factors influencing these variations to maintain consistent and positive returns on total capital.
Peer comparison
Jan 31, 2025