Target Corporation (TGT)
Return on total capital
| Feb 1, 2025 | Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 5,566,000 | 5,799,000 | 3,896,000 | 9,328,000 | 6,523,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 14,666,000 | 13,432,000 | 11,232,000 | 12,827,000 | 14,440,000 |
| Return on total capital | 37.95% | 43.17% | 34.69% | 72.72% | 45.17% |
February 1, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $5,566,000K ÷ ($—K + $14,666,000K)
= 37.95%
The return on total capital for Target Corporation has shown variation over the past five years. In January 2022, the return on total capital was the highest at 72.72%, indicating strong profitability in relation to the total capital employed. This was a significant improvement from the 45.17% reported in January 2021. However, there was a decrease in the return on total capital in the following years, reaching 34.69% in January 2023, 43.17% in February 2024, and 37.95% in February 2025.
It is important for Target Corporation to closely monitor and manage its return on total capital to ensure efficient use of its total capital resources. The fluctuation in this ratio suggests potential changes in the company's operational efficiency, profitability, or capital structure. Target should aim to maintain a stable and consistent return on total capital to demonstrate effective capital allocation and sustainable growth over time.
Peer comparison
Feb 1, 2025