Synopsys Inc (SNPS)

Return on total capital

		Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,472,418	1,574,262	1,538,872	1,501,659	1,314,723	1,116,508	1,031,460	1,077,678	1,123,370	1,109,391	1,083,966	959,967	810,038	802,802	826,249	721,183	644,199	583,657	480,987	506,733
Long-term debt	US$ in thousands	15,601	15,599	16,960	16,951	18,078	18,165	20,201	20,569	20,824	21,960	23,775	24,370	25,094	24,754	25,620	25,658	100,823	107,104	114,370	122,516
Total stockholders’ equity	US$ in thousands	8,990,700	7,709,400	7,153,160	6,670,980	6,147,310	5,958,560	5,831,860	5,636,750	5,515,720	5,604,030	5,564,310	5,386,770	5,295,140	5,151,020	5,088,140	4,882,250	4,907,400	4,595,920	4,275,090	4,148,830
Return on total capital		16.35%	20.38%	21.46%	22.45%	21.32%	18.68%	17.63%	19.05%	20.29%	19.72%	19.40%	17.74%	15.23%	15.51%	16.16%	14.69%	12.86%	12.41%	10.96%	11.86%

October 31, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,472,418K ÷ ($15,601K + $8,990,700K)
= 16.35%

Synopsys Inc's return on total capital has shown a positive trend over the past several quarters, indicating efficient utilization of both debt and equity to generate profits. The return on total capital increased from 11.86% in January 2020 to 22.45% in January 2024, reaching its peak during this period. While there were some fluctuations in the interim quarters, the overall trend reflects a strong performance in generating returns relative to the total capital employed by the company. This metric suggests that Synopsys Inc has been effectively deploying its resources to create value for its stakeholders and indicates a healthy financial position.