AT&T Inc (T)
Return on total capital
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 20,167,000 | 19,109,000 | 23,304,000 | 24,366,000 | 25,329,000 | -973,000 | 1,070,000 | 738,000 | 1,364,000 | 31,006,000 | 31,493,000 | 28,686,000 | 32,352,000 | 10,722,000 | 7,435,000 | 7,331,000 | 3,719,000 | 22,618,000 | 23,784,000 | 26,488,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 104,372,000 | 102,351,000 | 105,310,000 | 104,540,000 | 103,297,000 | 103,703,000 | 101,903,000 | 99,396,000 | 97,500,000 | 122,406,000 | 117,746,000 | 169,036,000 | 166,332,000 | 163,771,000 | 162,296,000 | 165,488,000 | 161,673,000 | 175,553,000 | 175,896,000 | 177,779,000 |
| Return on total capital | 19.32% | 18.67% | 22.13% | 23.31% | 24.52% | -0.94% | 1.05% | 0.74% | 1.40% | 25.33% | 26.75% | 16.97% | 19.45% | 6.55% | 4.58% | 4.43% | 2.30% | 12.88% | 13.52% | 14.90% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $20,167,000K ÷ ($—K + $104,372,000K)
= 19.32%
AT&T Inc's return on total capital has fluctuated over the past few years. The ratio was relatively stable around the range of 12% to 14% during 2020 and 2021. There was a significant drop in December 2021 to 2.30%, which suggests a decline in efficiency in generating returns from its total capital.
However, there was a notable improvement in the subsequent quarters of 2022, with the return on total capital increasing to above 20%, peaking at 26.75% in June 2022. This indicates a potential optimization in the utilization of capital to generate returns.
The ratio then experienced a decline again in the latter part of 2022 and throughout 2023, dropping to negative values in September 2023. This negative return on total capital implies that the company may not be effectively utilizing its capital resources to generate profits during that period.
Towards the end of 2023 and going into 2024, there was a strong rebound in the return on total capital, reaching as high as 24.52% in December 2023. The ratio remained relatively stable in the range of 18% to 23% in the subsequent quarters of 2024, indicating improved efficiency in using capital to generate returns.
Overall, it is essential for AT&T Inc to continue monitoring and managing its return on total capital, ensuring efficient allocation of resources to maximize profitability and maintain sustainable growth in the long term.
Peer comparison
Dec 31, 2024