Under Armour Inc C (UA)

Return on total capital

Mar 31, 2025 Mar 31, 2024 Dec 31, 2023 Mar 31, 2023 Dec 31, 2022
Earnings before interest and tax (EBIT) US$ in thousands — 229,751 — 263,586 283,811
Long-term debt US$ in thousands — — — — —
Total stockholders’ equity US$ in thousands 1,890,280 2,153,290 2,153,290 1,998,400 1,998,400
Return on total capital 0.00% 10.67% 0.00% 13.19% 14.20%

March 31, 2025 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $1,890,280K)
= 0.00%

Return on total capital is a key financial metric that indicates how well a company is generating returns from all of its sources of capital, including both debt and equity. Analyzing the data provided for Under Armour Inc C, we observe fluctuations in its return on total capital over the years.

As of December 31, 2022, the company's return on total capital was 14.20%, indicating that for every dollar of capital invested, Under Armour Inc C generated a return of 14.20%. This is a positive sign of efficient capital utilization.

However, the return on total capital dropped to 13.19% as of March 31, 2023, showcasing a slight decrease in capital efficiency.

Notably, there was a significant decline in the return on total capital to 0.00% as of December 31, 2023, which indicates that the company did not generate any returns on the capital invested during that period. This could be a cause for concern as it suggests a possible inefficiency in capital utilization.

The return on total capital improved to 10.67% as of March 31, 2024, indicating a partial recovery in generating returns from capital.

However, the return on total capital dropped again to 0.00% as of March 31, 2025, suggesting a potential challenge in efficiently utilizing capital resources.

In summary, the fluctuations in Under Armour Inc C's return on total capital over the analyzed periods reveal varying degrees of efficiency in generating returns from the capital employed. It would be crucial for the company to closely monitor and enhance its capital utilization strategies to ensure sustained profitability and value creation for its stakeholders.