Volcano (FRA:VQY) Forward Rate of Return (Yacktman) % : -1.50% (As of Sep. 2014)

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What is Volcano Forward Rate of Return (Yacktman) %?

Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Volcano's forward rate of return for was -1.50%.

The historical rank and industry rank for Volcano's Forward Rate of Return (Yacktman) % or its related term are showing as below:

FRA:VQY's Forward Rate of Return (Yacktman) % is not ranked ^*
in the Medical Devices & Instruments industry.
Industry Median: 10.91
* Ranked among companies with meaningful Forward Rate of Return (Yacktman) % only.

Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.

Volcano Forward Rate of Return (Yacktman) % Historical Data

The historical data trend for Volcano's Forward Rate of Return (Yacktman) % 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.

* Premium members only.

Volcano Forward Rate of Return (Yacktman) % Chart

Volcano Annual Data

Trend

Dec04

Dec05

Dec06

Dec07

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Forward Rate of Return (Yacktman) %

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-3.08

-1.30

-0.55

-0.46

-0.60

Volcano Quarterly Data
	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14
Forward Rate of Return (Yacktman) %	Get a 7-Day Free Trial															-0.74	-0.60	-0.77	-0.99	-1.50

Competitive Comparison of Volcano's Forward Rate of Return (Yacktman) %

For the Medical Devices subindustry, Volcano's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % 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.

Volcano's Forward Rate of Return (Yacktman) % Distribution in the Medical Devices & Instruments Industry

For the Medical Devices & Instruments industry and Healthcare sector, Volcano's Forward Rate of Return (Yacktman) % distribution charts can be found below:

* The bar in red indicates where Volcano's Forward Rate of Return (Yacktman) % falls into.

Volcano Forward Rate of Return (Yacktman) % Calculation

Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):

If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.

The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).

Volcano's Forward Rate of Return of Sep. 2014 is

Forward Rate of Return	=	Normalized Free Cash Flow	/	Price	+	5-Year EBITDA Growth Rate
	=	0	/	8.63	+	0
	=	0.00 %

Volcano (FRA:VQY) Forward Rate of Return (Yacktman) % Explanation

Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.

For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.

Be Aware

In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.

Volcano Forward Rate of Return (Yacktman) % Related Terms

Thank you for viewing the detailed overview of Volcano's Forward Rate of Return (Yacktman) % provided by GuruFocus.com. Please click on the following links to see related term pages.

Volcano (FRA:VQY) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Volcano Corp (FRA:VQY) » Definitions » Forward Rate of Return (Yacktman) %

Comparable Companies

Traded in Other Exchanges

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Address

Website

http://www.volcanocorp.com

Volcano Corp incorporated in the state of Delaware in January 2000. The Company completed its initial public offering on June 15, 2006. The Company designs, develops, manufactures and commercializes a broad suite of precision guided therapy tools including intravascular ultrasound, or IVUS, and fractional flow reserve, or FFR, products. The IVUS products include single-procedure disposable phased array and rotational IVUS imaging catheters, and additional functionality options such as ChromaFlo stent apposition analysis. FFR offerings can be accessed through its multi-modality platforms, and it also provide FFR-only consoles. Its products include: IVUS Products, Catheters, its single-use disposable catheters operate and interface solely with its family of consoles. Catheters, its single-use disposable catheters operate and interface solely with its family of consoles. ChromaFlo stent apposition analysis technology uses sequential IVUS frames to differentiate circulating blood from stationary or anchored tissue. SyncVision, Sync-Rx Ltd, or Sync-Rx, an Israel-based company that develops advanced software applications designed to optimize and facilitate trans-catheter cardiovascular interventions using automated online image processing. FFR products consist of pressure and flow consoles and single-procedure disposable pressure and flow guide wires. The Company's primary imaging competitors globally are Boston Scientific, Inc., or Boston Scientific, with its IVUS offering and St. Jude Medical, Inc., or St. Jude with its OCT offering. In Japan, it also competes with Terumo Corporation, which offers both IVUS and OCT. In the FFR market, its primary competitor is St. Jude. Because of the size of the vascular market opportunities, competitors and potential competitors have dedicated and will continue to dedicate significant resources to aggressively promote their products. It has registered and common law trademarks in the U.S. and elsewhere in the world including, but not limited to, Aim, Axsun, Bi-Trieval, Centriq, ChromaFlo, ComboMap, ComboWire, Core, Crux, Crux Biomedical, Define, Eagle Eye, ETNA, FACT, FloMap, FloWire, Ginko, GlyDx, Hi-Q, iFR, In-Line Digital, Instant Wave-Free Ratio, Intentio, Octave, pcFM, Precision Guided Therapy, PreView, PrimeWire, PrimeWire Prestige, ReFlow, Revolution, SlyDx, s5i, SmartMap, SpinVision, Sync-Rx, Trak Back, Valet, Verrata, VH, VIBE, Virtual Histology, Visions, Volcano, Wavewire, Xtract and Zuum. The Company's medical device products are subject to extensive and rigorous regulation by the FDA, as well as other federal and state regulatory bodies in the U.S. and comparable authorities in other countries.

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