Stryker Corporation (SYK)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 3,689,000 | 3,888,000 | 2,841,000 | 2,584,000 | 2,223,000 |
| Long-term debt | US$ in thousands | 12,188,000 | 10,901,000 | 11,857,000 | 12,472,000 | 13,230,000 |
| Total stockholders’ equity | US$ in thousands | 20,634,000 | 18,593,000 | 16,616,000 | 14,877,000 | 13,084,000 |
| Return on total capital | 11.24% | 13.18% | 9.98% | 9.45% | 8.45% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,689,000K ÷ ($12,188,000K + $20,634,000K)
= 11.24%
The return on total capital for Stryker Corporation has shown a positive trend over the five-year period from December 31, 2020, to December 31, 2024. Starting at 8.45% in 2020, the return on total capital increased to 11.24% by the end of 2024. This indicates an improvement in the company's ability to generate profits from its total capital employed.
Looking at the year-on-year performance, there was steady growth in the return on total capital, reaching a peak of 13.18% by the end of 2023 before slightly decreasing in 2024.
The increasing trend in return on total capital reflects positively on Stryker Corporation's efficiency in utilizing its total capital to generate returns for its investors. This indicates that the company is effectively managing its capital investments to generate profits, which is a key indicator of financial performance and long-term sustainability.
Peer comparison
Dec 31, 2024