Thermo Fisher Scientific Inc (TMO)
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 | 8,427,000 | 6,859,000 | 8,560,000 | 10,372,000 | 7,867,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 49,551,000 | 46,735,000 | 43,978,000 | 40,793,000 | 34,507,000 |
| Return on total capital | 17.01% | 14.68% | 19.46% | 25.43% | 22.80% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $8,427,000K ÷ ($—K + $49,551,000K)
= 17.01%
Thermo Fisher Scientific Inc's return on total capital has shown some fluctuations over the years. The return on total capital increased from 22.80% in December 31, 2020, to 25.43% in December 31, 2021, indicating improved efficiency in generating profits from both equity and debt funding sources. However, the return on total capital decreased to 19.46% by December 31, 2022, and further declined to 14.68% by December 31, 2023, suggesting potential challenges in utilizing the total capital effectively.
Although there was a decrease in the return on total capital in 2023, there was a slight recovery in 2024, with the ratio increasing to 17.01%. It is important for Thermo Fisher Scientific Inc to closely monitor and manage its capital allocation strategies to ensure sustainable returns on total capital in the future.
Overall, the trend in Thermo Fisher Scientific Inc's return on total capital reflects the company's ability to generate profits relative to the total capital employed, with fluctuations indicating potential changes in operational efficiency and financial performance.
Peer comparison
Dec 31, 2024