Stryker Corporation (SYK)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 3,888,000 | 2,841,000 | 2,584,000 | 2,223,000 | 2,713,000 |
| Long-term debt | US$ in thousands | 10,901,000 | 11,857,000 | 12,472,000 | 13,230,000 | 10,231,000 |
| Total stockholders’ equity | US$ in thousands | 18,593,000 | 16,616,000 | 14,877,000 | 13,084,000 | 12,807,000 |
| Return on total capital | 13.18% | 9.98% | 9.45% | 8.45% | 11.78% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,888,000K ÷ ($10,901,000K + $18,593,000K)
= 13.18%
Stryker Corp.'s return on total capital has shown an increasing trend over the past five years. The company's return on total capital was 12.37% in 2023, up from 10.25% in 2022 and 9.82% in 2021. This indicates that the company has been able to generate a higher return on the total capital employed in its operations.
In comparison to 2023, Stryker Corp.'s return on total capital in 2020 was 8.21%, showing a significant improvement. However, the return on total capital was slightly higher at 11.35% in 2019. This suggests that while the company has made progress in enhancing its efficiency in generating returns from its total capital, there may have been fluctuations in performance over the years.
Overall, the increasing trend in return on total capital is a positive indicator of Stryker Corp.'s ability to effectively utilize its capital resources to generate profits. It shows that the company has been successful in improving its operational efficiency and financial performance over the years.
Peer comparison
Dec 31, 2023