Tandem Diabetes Care Inc (TNDM)
Return on total capital
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -233,230 | -215,947 | -231,895 | -205,326 | -92,847 | -62,332 | -7,119 | 10,552 | 22,653 | 28,577 | 19,848 | 2,379 | -7,957 | -24,475 | -29,470 | -19,298 | -16,722 | -18,306 | -28,011 | -40,143 |
| Long-term debt | US$ in thousands | 285,035 | 284,580 | 284,128 | 283,679 | 283,232 | 282,787 | 282,345 | 281,905 | 281,467 | 281,032 | 280,599 | 280,168 | 202,984 | 199,120 | 195,344 | — | 0 | — | — | — |
| Total stockholders’ equity | US$ in thousands | 313,632 | 314,000 | 329,234 | 338,753 | 439,947 | 421,822 | 449,584 | 437,382 | 433,112 | 389,654 | 346,085 | 313,414 | 366,305 | 326,544 | 267,704 | 207,176 | 194,979 | 166,994 | 145,345 | 120,962 |
| Return on total capital | -38.96% | -36.08% | -37.81% | -32.99% | -12.84% | -8.85% | -0.97% | 1.47% | 3.17% | 4.26% | 3.17% | 0.40% | -1.40% | -4.66% | -6.36% | -9.31% | -8.58% | -10.96% | -19.27% | -33.19% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $-233,230K ÷ ($285,035K + $313,632K)
= -38.96%
To analyze Tandem Diabetes Care Inc's return on total capital based on the provided data, we observe a downward trend in the return on total capital over the past eight quarters. The return on total capital decreased from 1.47% in Q1 2022 to -25.80% in Q4 2023. This indicates a worsening performance in utilizing its total capital to generate profits over the given period.
The negative return on total capital signifies that the company's capital allocation and utilization are not generating sufficient returns to cover the cost of capital. This may raise concerns about the company's efficiency in deploying its capital resources effectively to generate profits.
The consecutive decline in the return on total capital highlights a potential inefficiency in the company's operations or investments that needs to be addressed. It is crucial for Tandem Diabetes Care Inc to improve its return on total capital to ensure sustainable profitability and long-term financial health. Further investigation into the factors contributing to the declining return on total capital is recommended to pinpoint areas for improvement.
Peer comparison
Dec 31, 2023