United Rentals Inc (URI)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 3,827,000 | 3,232,000 | 2,277,000 | 1,800,000 | 2,152,000 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 8,130,000 | 7,062,000 | 5,991,000 | 4,545,000 | 3,830,000 |
| Return on total capital | 47.07% | 45.77% | 38.01% | 39.60% | 56.19% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,827,000K ÷ ($—K + $8,130,000K)
= 47.07%
United Rentals, Inc.'s return on total capital has shown a generally positive trend over the past five years, increasing from 14.23% in 2019 to 19.62% in 2023. This indicates a strong ability to generate profits from the total capital employed in the business. The consistent improvement in this ratio suggests effective capital allocation and operational efficiency, reflecting positively on the company's financial management. This trend could indicate that United Rentals, Inc. is effectively utilizing its capital to generate higher returns for its investors. The company's ability to maintain and improve this ratio over time may signal its strong performance and potentially attractive investment prospects.
Peer comparison
Dec 31, 2023