Vertex Pharmaceuticals Inc (VRTX)
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 | 3,832,000 | 4,307,400 | 2,782,100 | 3,175,050 | 1,453,400 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 17,580,400 | 13,912,700 | 10,100,000 | 8,686,800 | 6,085,200 |
| Return on total capital | 21.80% | 30.96% | 27.55% | 36.55% | 23.88% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,832,000K ÷ ($—K + $17,580,400K)
= 21.80%
Vertex Pharmaceuticals, Inc. has shown a fluctuating trend in its return on total capital over the past five years. The return on total capital was highest in 2020 at 30.96% and lowest in 2019 at 18.06%. In 2023, the return on total capital decreased to 23.92% compared to the previous year's 30.35%. This indicates that the company's ability to generate profit relative to its total capital invested has slightly decreased in 2023. However, Vertex Pharmaceuticals, Inc. generally maintains a strong return on total capital, reflecting efficient capital utilization and effective management of its assets and liabilities.
Peer comparison
Dec 31, 2023