Tyco International (Tyco International) ROC % : 9.91% (As of Jun. 2016)

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What is Tyco International 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 %. Tyco International's annualized return on capital (ROC %) for the quarter that ended in Jun. 2016 was 9.91%.

As of today (2024-04-26), Tyco International's WACC % is 0.00%. Tyco International's ROC % is 0.00% (calculated using TTM income statement data). Tyco International earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Tyco International ROC % Historical Data

The historical data trend for Tyco International'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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Tyco International ROC % Chart

Tyco International Annual Data

Trend

Sep06

Sep07

Sep08

Sep09

Sep10

Sep11

Sep12

Sep13

Sep14

Sep15

ROC %

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3.04

25.53

6.67

7.34

9.36

Tyco International Quarterly Data
	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16
ROC %	Get a 7-Day Free Trial															10.85	10.17	8.67	8.19	9.91

Tyco International ROC % Calculation

Tyco International's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2015 is calculated as:

	ROC % (A: Sep. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2014 )	+	Invested Capital (A: Sep. 2015 ))	/ count )
=	1059 * ( 1 - 13.99% )	/	( (9212	+	10256)	/ 2 )
=	910.8459	/	9734
=	9.36 %

where

	Invested Capital		(A: Sep. 2014 )
=	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	))
=	11809	-	1705	-	( 892	-	max(0, 3477	-	4786	+	892	))
=	9212

	Invested Capital		(A: Sep. 2015 )
=	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	))
=	12321	-	1257	-	( 1401	-	max(0, 3845	-	4653	+	1401	))
=	10256

Tyco International's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2016 is calculated as:

	ROC % (Q: Jun. 2016 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2016 )	+	Invested Capital (Q: Jun. 2016 ))	/ count )
=	992 * ( 1 - 11.44% )	/	( (8826	+	8906)	/ 2 )
=	878.5152	/	8866
=	9.91 %

where

	Invested Capital		(Q: Mar. 2016 )
=	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	))
=	11611	-	2440	-	( 345	-	max(0, 3233	-	3663	+	345	))
=	8826

	Invested Capital		(Q: Jun. 2016 )
=	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	))
=	11614	-	2363	-	( 345	-	max(0, 3116	-	3822	+	345	))
=	8906

Note: The Operating Income data used here is four times the quarterly (Jun. 2016) data.

Tyco International (NYSE:TYC) 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, Tyco International's WACC % is 0.00%. Tyco International's ROC % is 0.00% (calculated using TTM income statement data). Tyco International 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.

Tyco International ROC % Related Terms

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Tyco International (Tyco International) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Business Services » Tyco International PLC (NYSE:TYC) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Unit 1202 Building 1000 City Gate, Mahon, Cork, IRL, 8212

Website

http://www.tyco.com

Tyco International PLC is a global provider of security products and services, fire detection and suppression products and services, and life safety products. Brand names include Tyco, Tyco Integrated Security, SimplexGrinnell, Sensormatic, Wormald, Scott, and ADT (outside North American markets). The revenue breakdown is 37% North America installation and services, 38% rest of world installation and services, and 25% global products. Tyco completed its spin-off of ADT and the flow control business in September 2012, five years after its prior three-way split.