Vertex Pharmaceuticals Inc (VRTX)

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	3,832,000	3,877,000	3,965,600	4,045,500	4,307,400	4,151,600	4,079,400	2,935,200	2,782,100	2,809,311	2,514,538	3,391,079	3,174,949	2,961,237	2,286,724	1,790,058	1,453,421	838,894	909,167	803,048
Long-term debt	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	17,580,400	16,512,800	15,470,200	14,432,300	13,912,700	13,029,600	11,933,500	10,907,000	10,100,000	9,530,800	9,196,400	8,980,300	8,686,800	8,133,470	7,519,240	6,461,650	6,085,200	5,253,390	5,069,960	4,723,310
Return on total capital		21.80%	23.48%	25.63%	28.03%	30.96%	31.86%	34.18%	26.91%	27.55%	29.48%	27.34%	37.76%	36.55%	36.41%	30.41%	27.70%	23.88%	15.97%	17.93%	17.00%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $3,832,000K ÷ ($—K + $17,580,400K)
= 21.80%

Vertex Pharmaceuticals, Inc.'s return on total capital has shown a fluctuating trend over the past eight quarters. The company's return on total capital ranged from 23.92% to 32.89% during this period. In general, the return on total capital has been relatively healthy, consistently above 20%.

The highest return on total capital was observed in Q2 2022 at 32.89%, indicating a strong performance in utilizing its total capital to generate profits. However, there was a slight decrease in Q1 2023, which rebounded in the subsequent quarters. The last reported return on total capital in Q4 2023 stood at 23.92%, which marks a decrease from the previous quarter but is still considered favorable.

Overall, Vertex Pharmaceuticals, Inc. has demonstrated efficient capital utilization, although there have been some fluctuations in performance. Further analysis and comparison with industry benchmarks would provide a more comprehensive understanding of the company's performance in generating returns on its total capital.