Zoetis Inc (ZTS)
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 | 3,179,000 | 2,880,000 | 2,715,000 | 2,229,000 | 2,024,000 |
| Long-term debt | US$ in thousands | 6,564,000 | 6,552,000 | 6,592,000 | 6,595,000 | 5,947,000 |
| Total stockholders’ equity | US$ in thousands | 4,997,000 | 4,405,000 | 4,543,000 | 3,769,000 | 2,708,000 |
| Return on total capital | 27.50% | 26.28% | 24.38% | 21.51% | 23.39% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $3,179,000K ÷ ($6,564,000K + $4,997,000K)
= 27.50%
Zoetis Inc's return on total capital has demonstrated a positive trend over the past five years. The ratio has increased from 22.22% in 2019 to 26.86% in 2023, indicating an improvement in the company's ability to generate profit relative to its total capital employed. This upward trajectory suggests efficient utilization of capital resources to generate returns for shareholders. The consistent performance and upward trend in return on total capital reflect the company's effective capital management and operational efficiency, which may be attributed to strategic investments, cost management, and revenue growth initiatives. Ultimately, Zoetis Inc's increasing return on total capital signals a strong financial performance and robust operational efficiency over the years.
Peer comparison
Dec 31, 2023