Return on Capital (ROC)
Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company debt and equity structure. It measures business productivity performance.
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Chipotle Mexican Grill Inc. pages available for free this week:
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Aggregate Accruals
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Return on Invested Capital (ROIC)
Chipotle Mexican Grill Inc., ROIC calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| ROIC3 | ||||||
| Benchmarks | ||||||
| ROIC, Competitors4 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Invested capital. See details »
3 2024 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Net operating profit after taxes (NOPAT)
- The net operating profit after taxes has shown a consistent upward trend over the analyzed period. Starting at approximately $614 million in 2020, NOPAT increased each subsequent year, reaching about $1.71 billion by 2024. This represents nearly a threefold increase within five years, indicating strong operational profitability improvement.
- Invested capital
- Invested capital demonstrated a generally increasing pattern, rising from roughly $4.94 billion in 2020 to about $6.83 billion in 2024. There was a slight decrease between 2021 and 2022, but the overall trajectory was upward, reflecting ongoing investments or asset accumulation over the period examined.
- Return on invested capital (ROIC)
- Return on invested capital improved significantly from 12.43% in 2020 to 24.99% in 2024. The increase was steady year-over-year, with especially notable gains between 2021 and 2023. This indicates enhanced efficiency in generating operating returns relative to the capital invested, suggesting improved profitability and capital utilization over time.
- Summary
- Overall, the data reveals strong financial performance trends highlighted by increasing net operating profits and improving capital efficiency. While invested capital grew moderately with a minor temporary dip, the company's ability to generate returns on its invested capital has more than doubled. These patterns indicate effective operational management and growing value creation for stakeholders during the period analyzed.
Decomposition of ROIC
Chipotle Mexican Grill Inc., decomposition of ROIC
| ROIC | = | OPM1 | × | TO2 | × | 1 – CTR3 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | × | ||||
| Dec 31, 2023 | = | × | × | ||||
| Dec 31, 2022 | = | × | × | ||||
| Dec 31, 2021 | = | × | × | ||||
| Dec 31, 2020 | = | × | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
- Operating Profit Margin (OPM)
- The operating profit margin shows a consistent and significant upward trend over the analyzed period. Starting at 8.03% in 2020, it increased to 13.23% in 2021 and continued rising to reach 20.1% by 2024. This steady improvement indicates enhanced operational efficiency and profitability.
- Turnover of Capital (TO)
- Turnover of capital improves steadily from 1.22 in 2020 to 1.66 in 2024. The upward trend suggests better utilization of invested capital to generate revenue, reflecting growing operational effectiveness in using assets.
- 1 – Effective Cash Tax Rate (CTR)
- The value for (1 - effective cash tax rate) exhibits a sharp decrease from an unusually high 127.06% in 2020 to approximately 78.72% in 2021, followed by a gradual stabilization around the mid-70% range in subsequent years. These figures imply fluctuations in tax expense relative to earnings, possibly due to varying tax strategies or one-time effects in early years.
- Return on Invested Capital (ROIC)
- Return on invested capital significantly increased from 12.43% in 2020 to 24.99% in 2024, more than doubling over this timeframe. This rising trend confirms improved overall efficiency and profitability on the capital invested, reflecting positively on management’s capital allocation decisions.
Operating Profit Margin (OPM)
Chipotle Mexican Grill Inc., OPM calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Add: Cash operating taxes2 | ||||||
| Net operating profit before taxes (NOPBT) | ||||||
| Revenue | ||||||
| Add: Increase (decrease) in unearned revenue | ||||||
| Adjusted revenue | ||||||
| Profitability Ratio | ||||||
| OPM3 | ||||||
| Benchmarks | ||||||
| OPM, Competitors4 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
OPM = 100 × NOPBT ÷ Adjusted revenue
= 100 × ÷ =
4 Click competitor name to see calculations.
- Net Operating Profit Before Taxes (NOPBT)
- The net operating profit before taxes has exhibited a consistent and substantial upward trend over the five-year period. Starting at approximately 483 million USD in 2020, the figure more than quadrupled to nearly 2.28 billion USD by 2024. This reflects strong operational profitability growth year over year, indicating effective cost management or revenue growth strategies.
- Adjusted Revenue
- Adjusted revenue has shown a steady and robust increase throughout the analyzed period. Beginning at around 6.02 billion USD in 2020, the revenue rose consistently each year, reaching over 11.34 billion USD in 2024. This pattern demonstrates sustained top-line growth that supports the expanding profit levels seen in the NOPBT figures.
- Operating Profit Margin (OPM)
- The operating profit margin has improved significantly, rising from 8.03% in 2020 to 20.1% in 2024. This upward movement reflects enhanced operational efficiency and profitability relative to revenue, indicating that the company is not only growing revenue but also controlling operating costs effectively.
- Overall Analysis
- The combined data indicate a company experiencing healthy financial growth characterized by rising revenues, increasing net operating profits before taxes, and improving operating margins. The acceleration in profit margins across the timeline suggests successful strategies in operational efficiency and potentially favorable market or cost conditions. The consistent upward trajectory across all metrics points to a strengthening financial position and improving profitability.
Turnover of Capital (TO)
Chipotle Mexican Grill Inc., TO calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Add: Increase (decrease) in unearned revenue | ||||||
| Adjusted revenue | ||||||
| Invested capital1 | ||||||
| Efficiency Ratio | ||||||
| TO2 | ||||||
| Benchmarks | ||||||
| TO, Competitors3 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Invested capital. See details »
2 2024 Calculation
TO = Adjusted revenue ÷ Invested capital
= ÷ =
3 Click competitor name to see calculations.
The financial data presents a consistent upward trajectory in key performance indicators over the observed periods.
- Adjusted Revenue
- There is a clear and steady increase in adjusted revenue from 6,017,189 thousand US dollars in 2020 to 11,342,750 thousand US dollars in 2024. This reflects robust growth in sales, with the revenue nearly doubling over five years. The growth rate appears to accelerate particularly after 2021, indicating positive business expansion and increased market demand.
- Invested Capital
- The invested capital shows a general rising trend, increasing from 4,937,915 thousand US dollars in 2020 to 6,827,838 thousand US dollars in 2024. There is a minor dip observed in 2022, with a slight decrease from 5,496,598 thousand US dollars in 2021 to 5,396,406 thousand US dollars; however, the overall investment recovered and grew through 2023 and 2024. This suggests steady reinvestment in capital assets supporting business growth, although there was brief capital adjustment or divestment in 2022.
- Turnover of Capital (TO)
- The turnover of capital ratio improved consistently, moving from 1.22 in 2020 to 1.66 in 2024. This indicates enhanced efficiency in utilizing invested capital to generate revenue. The most notable increases occurred between 2021 and 2023, suggesting effective capital management and increased operational productivity during this period. The ratio leveling off near 1.65-1.66 in the last two periods may suggest stabilization at a higher efficiency level.
In summary, the data indicates strong growth in revenue backed by increasing investment in capital, accompanied by improving capital efficiency. The company appears to be scaling its operations successfully while enhancing the return generated per unit of invested capital. The minor fluctuation in invested capital during 2022 could warrant further investigation, but overall trends point to positive financial momentum.
Effective Cash Tax Rate (CTR)
Chipotle Mexican Grill Inc., CTR calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Add: Cash operating taxes2 | ||||||
| Net operating profit before taxes (NOPBT) | ||||||
| Tax Rate | ||||||
| CTR3 | ||||||
| Benchmarks | ||||||
| CTR, Competitors4 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × ÷ =
4 Click competitor name to see calculations.
- Cash Operating Taxes
- The cash operating taxes have shown a consistent upward trend from 2020 to 2024. Starting with a negative value of approximately -130,767 thousand US dollars in 2020, they shifted to a positive figure of 213,319 thousand US dollars in 2021 and increased steadily year-over-year, reaching 573,988 thousand US dollars by 2024. This progression indicates a significant rise in tax payments over the period analyzed.
- Net Operating Profit Before Taxes (NOPBT)
- The net operating profit before taxes has demonstrated robust growth throughout the five-year period. Beginning at 483,214 thousand US dollars in 2020, the NOPBT more than doubled in 2021 to 1,002,252 thousand US dollars. This upward momentum continued through subsequent years, achieving 2,279,991 thousand US dollars by 2024. This reflects sustained operational profitability improvement over time.
- Effective Cash Tax Rate (CTR)
- The effective cash tax rate has experienced variability initially, followed by relative stabilization. In 2020, a negative cash tax rate of -27.06% was recorded, possibly due to tax refunds or adjustments. In 2021, the rate increased substantially to 21.28%, then gradually rose to 25.95% in 2022 before slightly declining to 24.38% in 2023 and modestly increasing again to 25.18% in 2024. Overall, from 2021 onward, the effective tax rate has remained close to 25%, suggesting a steady tax environment relative to operating profits.
- Summary of Trends
- The analysis reveals a consistent increase in both net operating profit before taxes and cash operating taxes, indicating growing profitability accompanied by corresponding increases in tax liabilities. The effective cash tax rate, after initial volatility, stabilized near the mid-20% range, reflecting consistent tax expense relative to operating profits. The initial negative tax payments and tax rate in 2020 notably shifted to positive and stable values, highlighting changes in the company’s tax position or profitability structure from that year forward.