Contango Oil & Gas Co (Contango Oil & Gas Co) ROIC % : 23.97% (As of Sep. 2021)

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What is Contango Oil & Gas Co ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Contango Oil & Gas Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2021 was 23.97%.

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

Contango Oil & Gas Co ROIC % Historical Data

The historical data trend for Contango Oil & Gas Co's ROIC % 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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Contango Oil & Gas Co ROIC % Chart

Contango Oil & Gas Co Annual Data

Trend

Jun11

Jun12

Jun13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

ROIC %

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-11.19

-5.56

-4.72

-5.58

-11.94

Contango Oil & Gas Co Quarterly Data
	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21
ROIC %	Get a 7-Day Free Trial															6.28	-6.95	20.62	21.62	23.97

Competitive Comparison of Contango Oil & Gas Co's ROIC %

For the Oil & Gas E&P subindustry, Contango Oil & Gas Co's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Contango Oil & Gas Co's ROIC % Distribution in the Oil & Gas Industry

For the Oil & Gas industry and Energy sector, Contango Oil & Gas Co's ROIC % distribution charts can be found below:

* The bar in red indicates where Contango Oil & Gas Co's ROIC % falls into.

Contango Oil & Gas Co ROIC % Calculation

Contango Oil & Gas Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2020 is calculated as:

	ROIC % (A: Dec. 2020 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2019 )	+	Invested Capital (A: Dec. 2020 ))	/ count )
=	-27.053 * ( 1 - -0.45% )	/	( (323.246	+	131.875)	/ 2 )
=	-27.1747385	/	227.5605
=	-11.94 %

where

	Invested Capital		(A: Dec. 2019 )
=	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	))
=	353.826	-	94.74	-	( 1.624	-	max(0, 110.547	-	46.387	+	1.624	))
=	323.246

	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	))
=	170.267	-	81.122	-	( 1.383	-	max(0, 89.536	-	46.806	+	1.383	))
=	131.875

Contango Oil & Gas Co's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2021 is calculated as:

	ROIC % (Q: Sep. 2021 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2021 )	+	Invested Capital (Q: Sep. 2021 ))	/ count )
=	124.616 * ( 1 - 6.55% )	/	( (422.564	+	549.062)	/ 2 )
=	116.453652	/	485.813
=	23.97 %

where

	Invested Capital		(Q: Jun. 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	))
=	442.697	-	123.749	-	( 2.177	-	max(0, 178.403	-	74.787	+	2.177	))
=	422.564

	Invested Capital		(Q: Sep. 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	))
=	573.083	-	162.797	-	( 3.084	-	max(0, 250.503	-	111.727	+	3.084	))
=	549.062

Note: The Operating Income data used here is four times the quarterly (Sep. 2021) data.

Contango Oil & Gas Co (AMEX:MCF) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Contango Oil & Gas Co's WACC % is 0.00%. Contango Oil & Gas Co's ROIC % is 0.00% (calculated using TTM income statement data).

Be Aware

Like ROE % and ROA %, ROIC % 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.

Contango Oil & Gas Co ROIC % Related Terms

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Contango Oil & Gas Co (Contango Oil & Gas Co) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » Contango Oil & Gas Co (AMEX:MCF) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

111 E. 5th Street, Suite 300, Fort Worth, TX, USA, 76102

Website

https://www.contango.com

Contango Oil & Gas Co is an independent oil and natural gas company. It is engaged in the exploration, development, exploitation, and acquisition of crude oil and natural gas properties in the onshore Texas Gulf Coast, offshore properties in the shallow waters of the Gulf of Mexico, and other regions.

Executives

Chad B Roller	officer: SVP-Chief Operating Officer	2431 E 61ST STREET SUITE 850 TULSA OK 74136
E Joseph Grady	officer: SVP and CFO	C/O CONTANGO OIL & GAS COMPANY 717 TEXAS AVENUE, SUITE 2900 HOUSTON TX 77002
Michael J Autin	officer: Vice President Operations	717 TEXAS AVENUE SUITE 2900 HOUSTON TX 77002
Bulent Ayhan Berilgen	director	50 WEST SAN FERNANDO ST SAN JOSE CA 95113
Joseph J Romano	director	3700 BUFFALO SPEEDWAY SUITE 960 HOUSTON TX 77098
Janet W Pasque	director	1675 BROADWAY SUITE 1950 DENVER CO 80202
Will Farley Dakan	officer: President	500 COMMERCE ST. SUITE 700 FORT WORTH TX 76102
Mclawhorn Charles L Iii	officer: SVP/General Counsel/Corp Sec	2501 NORTH HARWOOD DALLAS TX 75201
Ellis L Mccain	director	C/O CONTANGO OIL & GAS COMPANY, 717 TEXAS AVENUE, SUITE 2900, HOUSTON TX 77002
Karen Jo Simon	director	1918 OLIVE STREET, #2904, DALLAS TX 75201
Dws Growth Capital Lp	10 percent owner	11 GREENWAY PLAZA, SUITE 3100 HOUSTON TX 77046
Douglas W Schnitzer	10 percent owner
Kkr Group Assets Iii Gp Llc	10 percent owner	30 HUDSON YARDS, NEW YORK NY 10001
George R Roberts	10 percent owner	C/O KOHLBERG KRAVIS ROBERTS & CO. L.P., 2800 SAND HILL ROAD, MENLO PARK CA 94025
Independence Energy Aggregator Gp Llc	10 percent owner	600 TRAVIS STREEET, SUITE 7200, HOUSTON TX 77002