TransMedics Group Inc (TMDX)

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	50,189	-15,780	-33,156	-41,134	-24,731
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	228,603	137,202	187,375	67,854	103,891
Return on total capital		21.95%	-11.50%	-17.69%	-60.62%	-23.80%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $50,189K ÷ ($—K + $228,603K)
= 21.95%

TransMedics Group Inc's return on total capital experienced fluctuations over the past few years. In 2020, the company had a negative return on total capital of -23.80%, indicating that it was not effectively utilizing its total capital to generate profits. This negative trend worsened in 2021, with a significant decrease to -60.62%, suggesting potential inefficiencies or challenges in the company's operations.

However, there was a slight improvement in 2022, as the return on total capital improved to -17.69%, although still negative. The trend continued to show progress in 2023, with a further decrease in the negative return to -11.50%, indicating a potential turnaround in the company's capital utilization and profitability.

The most significant positive change occurred in 2024, where TransMedics Group Inc achieved a notable return on total capital of 21.95%. This sharp increase suggests improved efficiency in capital allocation and higher profitability, demonstrating a positive outlook for the company's financial performance moving forward.

Overall, the fluctuating trend in return on total capital indicates that TransMedics Group Inc has experienced challenges in effectively utilizing its total capital in the past but has shown signs of improvement and potential for growth in recent years.