Zimmer Biomet Holdings Inc (ZBH)

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	1,277,700	895,200	873,900	825,200	696,300	858,400	856,100	800,000	860,300	1,138,100	1,194,300	797,800	83,100	8,300	-45,100	331,300	1,137,500	10,200	-12,300	79,000
Long-term debt	US$ in thousands	4,867,900	5,127,400	5,189,400	5,204,800	5,152,200	5,055,200	5,172,000	5,286,300	5,463,700	6,458,100	6,802,500	7,538,700	7,626,500	7,840,200	7,759,300	7,724,200	6,721,400	6,345,900	6,719,300	8,310,600
Total stockholders’ equity	US$ in thousands	12,480,500	12,510,800	12,371,500	12,150,700	12,020,300	12,244,700	12,118,400	12,015,500	12,660,700	12,708,600	12,577,900	12,445,000	12,194,200	11,872,200	11,641,400	11,878,600	12,388,100	12,081,500	11,659,100	11,534,400
Return on total capital		7.36%	5.08%	4.98%	4.75%	4.05%	4.96%	4.95%	4.62%	4.75%	5.94%	6.16%	3.99%	0.42%	0.04%	-0.23%	1.69%	5.95%	0.06%	-0.07%	0.40%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,277,700K ÷ ($4,867,900K + $12,480,500K)
= 7.36%

Zimmer Biomet Holdings Inc's return on total capital has shown a relatively stable performance over the past eight quarters. The trend indicates a consistent improvement in return on total capital, starting from 5.33% in Q1 2022 to 7.95% in Q4 2023. This demonstrates the company's ability to efficiently generate profits from its total capital employed.

The company's return on total capital has generally been increasing, which suggests that Zimmer Biomet Holdings Inc is becoming more effective in utilizing its capital to generate returns for its investors. This is a positive indicator of the company's financial health and operational efficiency.

Overall, the upward trend in return on total capital for Zimmer Biomet Holdings Inc reflects a positive performance and indicates that the company is effectively managing its capital resources to generate profitability over the analyzed time period.