Xcel Energy Inc (XEL)
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 | 2,680,000 | 2,554,000 | 2,369,000 | 2,307,000 | 2,273,000 |
| Long-term debt | US$ in thousands | 22,927,000 | 20,897,000 | 25,232,000 | 24,412,000 | 20,227,000 |
| Total stockholders’ equity | US$ in thousands | 17,616,000 | 16,675,000 | 15,612,000 | 14,575,000 | 13,239,000 |
| Return on total capital | 6.61% | 6.80% | 5.80% | 5.92% | 6.79% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $2,680,000K ÷ ($22,927,000K + $17,616,000K)
= 6.61%
Based on the data provided, Xcel Energy, Inc.'s return on total capital has been relatively stable over the past five years, ranging from 5.81% to 6.71%. The company's return on total capital measures its ability to generate profits from all of its capital resources, including debt and equity.
The slight fluctuations in the return on total capital indicate that Xcel Energy is effectively utilizing its capital to generate returns for its shareholders and debt holders. However, the decreasing trend from 2019 to 2021 may suggest that the company faced challenges in maintaining or improving its profitability during those years.
Overall, Xcel Energy's return on total capital averaging around 6% indicates that the company is efficiently managing its capital to generate returns, although there may be opportunities for further optimization to improve profitability in the future.
Peer comparison
Dec 31, 2023