Pintec Technology Holdings (Pintec Technology Holdings) ROC % : -0.86% (As of Jun. 2023)

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What is Pintec Technology Holdings ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Pintec Technology Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2023 was -0.86%.

As of today (2024-04-27), Pintec Technology Holdings's WACC % is 6.91%. Pintec Technology Holdings's ROC % is -38.84% (calculated using TTM income statement data). Pintec Technology Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Pintec Technology Holdings ROC % Historical Data

The historical data trend for Pintec Technology Holdings'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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Pintec Technology Holdings ROC % Chart

Pintec Technology Holdings Annual Data

Trend

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

ROC %

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0.18

-49.30

-19.82

-21.32

-29.90

Pintec Technology Holdings Semi-Annual Data
	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23
ROC %	Get a 7-Day Free Trial									-17.82	-32.02	-22.50	-55.30	-0.86

Pintec Technology Holdings ROC % Calculation

Pintec Technology Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2022 is calculated as:

	ROC % (A: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2021 )	+	Invested Capital (A: Dec. 2022 ))	/ count )
=	-11.695 * ( 1 - -1.3% )	/	( (40.592	+	38.645)	/ 2 )
=	-11.847035	/	39.6185
=	-29.90 %

where

	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	))
=	119.516	-	59.778	-	( 36.244	-	max(0, 63.581	-	82.727	+	36.244	))
=	40.592

	Invested Capital		(A: Dec. 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	))
=	75.86	-	56.836	-	( 36.893	-	max(0, 75.446	-	55.825	+	36.893	))
=	38.645

Pintec Technology Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2023 is calculated as:

	ROC % (Q: Jun. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2022 )	+	Invested Capital (Q: Jun. 2023 ))	/ count )
=	-3.376 * ( 1 - 94.19% )	/	( (38.645	+	6.979)	/ 2 )
=	-0.1961456	/	22.812
=	-0.86 %

where

	Invested Capital		(Q: Dec. 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	))
=	75.86	-	56.836	-	( 36.893	-	max(0, 75.446	-	55.825	+	36.893	))
=	38.645

	Invested Capital		(Q: Jun. 2023 )
=	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	))
=	21.518	-	50.783	-	( 2.033	-	max(0, 50.797	-	14.553	+	2.033	))
=	6.979

Note: The Operating Income data used here is two times the semi-annual (Jun. 2023) data.

Pintec Technology Holdings (NAS:PT) 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, Pintec Technology Holdings's WACC % is 6.91%. Pintec Technology Holdings's ROC % is -38.84% (calculated using TTM income statement data). Pintec Technology Holdings 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.

Pintec Technology Holdings ROC % Related Terms

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Pintec Technology Holdings (Pintec Technology Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Credit Services » Pintec Technology Holdings Ltd (NAS:PT) » Definitions » ROC %

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Address

No. 109 Yard Tianjizhigu, 3rd Floor, No. 11 Building, Jinghai 3rd Street, BDA, Beijing, CHN, 101111

Website

https://www.pintec.com

Pintec Technology Holdings Ltd is a technology platform that provides financial services in China in terms of loan volume facilitated. The company connects business partners and financial partners on its open platform and enables them to provide financial services to end-users. Its products include installment loans, personal loans, wealth management, insurance brokerage, SME loans, and others. The company generates its revenue from technical service fees also by providing financing for these borrowers and earn installment service fees, They earn wealth management services fees and commission on financial products.