TKO Group Holdings, Inc. (TKO)
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 | 283,465 | 446,477 | 543,116 | 263,472 | 206,710 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,091,020 | 4,108,980 | 568,916 | 1,248,890 | 383,994 |
| Return on total capital | 6.93% | 10.87% | 95.47% | 21.10% | 53.83% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $283,465K ÷ ($—K + $4,091,020K)
= 6.93%
TKO Group Holdings, Inc.'s return on total capital has fluctuated over the years based on the provided data. In 2020, the return on total capital was strong at 53.83%, indicating that the company generated $0.5383 in profit for every dollar of total capital employed. However, there was a notable decrease in 2021 to 21.10%, which suggests a decline in the company's ability to generate returns on its total capital.
The return on total capital significantly improved in 2022, reaching 95.47%, indicating that the company efficiently utilized its total capital to generate profits. However, the performance dropped notably in 2023 to 10.87%, signifying a sharp decrease in the effectiveness of the company’s capital deployment.
By the end of 2024, TKO Group Holdings, Inc. recorded a return on total capital of 6.93%. This continued decline raises concerns about the company's ability to generate returns proportional to its total capital investment. It is crucial for the company to assess its capital allocation strategies and operational efficiency to improve its return on total capital in the future.
Peer comparison
Dec 31, 2024