MedMira (MedMira) ROC % : -12.80% (As of Jan. 2024)

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What is MedMira 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 %. MedMira's annualized return on capital (ROC %) for the quarter that ended in Jan. 2024 was -12.80%.

As of today (2024-05-22), MedMira's WACC % is 7.20%. MedMira's ROC % is -17.85% (calculated using TTM income statement data). MedMira earns returns that do not match up to its cost of capital. It will destroy value as it grows.

MedMira ROC % Historical Data

The historical data trend for MedMira'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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MedMira ROC % Chart

MedMira Annual Data

Trend

Jul14

Jul15

Jul16

Jul17

Jul18

Jul19

Jul20

Jul21

Jul22

Jul23

ROC %

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-14.53

-11.31

0.05

-11.02

-18.05

MedMira Quarterly Data
	Apr19	Jul19	Oct19	Jan20	Apr20	Jul20	Oct20	Jan21	Apr21	Jul21	Oct21	Jan22	Apr22	Jul22	Oct22	Jan23	Apr23	Jul23	Oct23	Jan24
ROC %	Get a 7-Day Free Trial															-15.46	-19.17	-18.34	-22.04	-12.80

MedMira ROC % Calculation

MedMira's annualized Return on Capital (ROC %) for the fiscal year that ended in Jul. 2023 is calculated as:

	ROC % (A: Jul. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jul. 2022 )	+	Invested Capital (A: Jul. 2023 ))	/ count )
=	-1.346 * ( 1 - 0% )	/	( (7.427	+	7.483)	/ 2 )
=	-1.346	/	7.455
=	-18.05 %

where

	Invested Capital		(A: Jul. 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	))
=	2.961	-	5.181	-	( 0.026	-	max(0, 10.929	-	1.282	+	0.026	))
=	7.427

	Invested Capital		(A: Jul. 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	))
=	2.764	-	5.904	-	( 0.01	-	max(0, 11.904	-	1.281	+	0.01	))
=	7.483

MedMira's annualized Return on Capital (ROC %) for the quarter that ended in Jan. 2024 is calculated as:

	ROC % (Q: Jan. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Oct. 2023 )	+	Invested Capital (Q: Jan. 2024 ))	/ count )
=	-1.096 * ( 1 - 0% )	/	( (8.344	+	8.776)	/ 2 )
=	-1.096	/	8.56
=	-12.80 %

where

	Invested Capital		(Q: Oct. 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	))
=	3.345	-	5.777	-	( 0.651	-	max(0, 12.732	-	1.956	+	0.651	))
=	8.344

	Invested Capital		(Q: Jan. 2024 )
=	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	))
=	3.326	-	5.941	-	( 0.636	-	max(0, 13.338	-	1.947	+	0.636	))
=	8.776

Note: The Operating Income data used here is four times the quarterly (Jan. 2024) data.

MedMira (OTCPK:MMIRF) 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, MedMira's WACC % is 7.20%. MedMira's ROC % is -17.85% (calculated using TTM income statement data). MedMira 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.

MedMira ROC % Related Terms

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MedMira (MedMira) Business Description

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GURUFOCUS.COM » STOCK LIST » Healthcare » Biotechnology » MedMira Inc (OTCPK:MMIRF) » Definitions » ROC %

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Address

155 Chain Lake Drive, Suite 1, Halifax, NS, CAN, B3S 1B3

Website

https://www.medmira.com

MedMira Inc is a biotechnology company that is engaged in the business of research, development, and manufacturing of rapid diagnostics and technologies. The company has one reportable operating segment, rapid diagnostic products and services. The product line of the company includes RevealHIV which detects antibodies to HIV-1 and HIV-2 in whole blood, serum or plasma; H Pylori which detects antibodies in serum, plasma, and whole blood; syphilis which detects treponema pallidum antibodies in serum, plasma, and whole blood; among other products. The company generates revenue geographically from North America, Europe, Asia pacific. The majority of the revenue is generated from North America.