Hudson Executive Investment II (Hudson Executive Investment II) ROC %

: -0.28% (As of Sep. 2022)

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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Hudson Executive Investment II's annualized return on capital (ROC %) for the quarter that ended in Sep. 2022 was -0.28%.

As of today (2024-04-18), Hudson Executive Investment II's WACC % is 0.00%. Hudson Executive Investment II's ROC % is 0.00% (calculated using TTM income statement data). Hudson Executive Investment II earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Hudson Executive Investment II ROC % Historical Data

The historical data trend for Hudson Executive Investment II's ROC % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Hudson Executive Investment II Annual Data

Trend

Dec20

Dec21

ROC %

-1.57

Hudson Executive Investment II Quarterly Data
	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22
ROC %				-0.60	0.17	-0.76	-0.41	-0.28

Hudson Executive Investment II ROC % Calculation

Hudson Executive Investment II's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2021 is calculated as:

	ROC % (A: Dec. 2021 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2020 )	+	Invested Capital (A: Dec. 2021 ))	/ count )
=	-1.966 * ( 1 - 0% )	/	( (0.421	+	250.087)	/ 2 )
=	-1.966	/	125.254
=	-1.57 %

where

	Invested Capital		(A: Dec. 2020 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	0.395	-	0.345	-	( 0	-	max(0, 0.371	-	0	+	0	))
=	0.421

	Invested Capital		(A: Dec. 2021 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	250.958	-	0.859	-	( 0.83	-	max(0, 0.859	-	0.871	+	0.83	))
=	250.087

Hudson Executive Investment II's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2022 is calculated as:

	ROC % (Q: Sep. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2022 )	+	Invested Capital (Q: Sep. 2022 ))	/ count )
=	-0.828 * ( 1 - 15.48% )	/	( (250.303	+	251.151)	/ 2 )
=	-0.6998256	/	250.727
=	-0.28 %

where

	Invested Capital		(Q: Jun. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	250.776	-	0.974	-	( 0.317	-	max(0, 0.974	-	0.473	+	0.317	))
=	250.303

	Invested Capital		(Q: Sep. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	251.558	-	1.198	-	( 0.332	-	max(0, 1.198	-	0.407	+	0.332	))
=	251.151

Note: The Operating Income data used here is four times the quarterly (Sep. 2022) data.

Hudson Executive Investment II (NAS:HCII) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.

There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.

Why is ROC % important?

Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.

As of today, Hudson Executive Investment II's WACC % is 0.00%. Hudson Executive Investment II's ROC % is 0.00% (calculated using TTM income statement data). Hudson Executive Investment II earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Be Aware

Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Hudson Executive Investment II ROC % Related Terms

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Hudson Executive Investment II (Hudson Executive Investment II) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Diversified Financial Services » Hudson Executive Investment Corp II (NAS:HCII) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

570 Lexington Avenue, 35th Floor, New York, NY, USA, 10022

Website

https://www.heic2.com

Hudson Executive Investment Corp II is a blank check company.

Executives

Doug Renert	director	2145 SHARON ROAD, MENLO PARK CA 94025
Ira Mosberg	officer: Chief Financial Officer	C/O HUDSON EXECUTIVE INVESTMENT CORP. II, 570 LEXINGTON AVENUE, 35TH FLOOR, NEW YORK NY 10022
Paul A Ormond	director	MANOR CARE INC, 333 N SUMMIT STREET, TOLEDO OH 43604
Amy W Schulman	director	PFIZER INC. ATTN: CORPORATE SECRETARY, 235 EAST 42ND STREET, NEW YORK NY 10017
Douglas L Braunstein	director, other: President, Chairman	HUDSON EXECUTIVE CAPITAL LP, 570 LEXINGTON AVENUE, 35TH FLOOR, NEW YORK NY 10022
Douglas Bergeron	director, officer: Chief Executive Officer	111 W. OCEAN BOULEVARD, LONG BEACH CA 90802
Jonathan Dobres	officer: Chief Financial Officer	570 LEXINGTON AVENUE, 35TH FLOOR, NEW YORK NY 10022
Hec Sponsor Ii Llc	10 percent owner	C/O HUDSON EXECUTIVE INVESTMENT CORP. II, 570 LEXINGTON AVENUE, 35TH FLOOR, NEW YORK NY 10022

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