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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 9 Meters Biopharma's annualized return on capital (ROC %) for the quarter that ended in Mar. 2023 was -351.59%.
As of today (2024-05-31), 9 Meters Biopharma's WACC % is 0.00%. 9 Meters Biopharma's ROC % is 0.00% (calculated using TTM income statement data). 9 Meters Biopharma earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for 9 Meters Biopharma'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.
9 Meters Biopharma Annual Data | |||||||||||||||||||||
Trend | Dec13 | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | Dec21 | Dec22 | |||||||||||
ROC % | Get a 7-Day Free Trial | -227.96 | -367.23 | -514.89 | -1,925.08 | -354.62 |
9 Meters Biopharma Quarterly Data | ||||||||||||||||||||
Jun18 | Sep18 | Dec18 | Mar19 | Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | |
ROC % | Get a 7-Day Free Trial | -2,792.14 | -2,966.55 | -220.47 | -165.86 | -351.59 |
9 Meters Biopharma'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 ) |
= | -42.017 * ( 1 - 0% ) | / | ( (1.877 | + | 21.82) | / 2 ) |
= | -42.017 | / | 11.8485 | |||
= | -354.62 % |
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 | )) |
= | 50.174 | - | 6.769 | - | ( 46.993 | - | max(0, 8.457 | - | 49.985 | + | 46.993 | )) |
= | 1.877 |
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 | )) |
= | 33.148 | - | 9.006 | - | ( 12.646 | - | max(0, 30.696 | - | 33.018 | + | 12.646 | )) |
= | 21.82 |
9 Meters Biopharma's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2023 is calculated as:
ROC % (Q: Mar. 2023 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Dec. 2022 ) | + | Invested Capital (Q: Mar. 2023 )) | / count ) |
= | -51.148 * ( 1 - 0% ) | / | ( (21.82 | + | 7.275) | / 2 ) |
= | -51.148 | / | 14.5475 | |||
= | -351.59 % |
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 | )) |
= | 33.148 | - | 9.006 | - | ( 12.646 | - | max(0, 30.696 | - | 33.018 | + | 12.646 | )) |
= | 21.82 |
Invested Capital | (Q: Mar. 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 | )) |
= | 9.313 | - | 8.418 | - | ( 6.939 | - | max(0, 15.577 | - | 9.197 | + | 6.939 | )) |
= | 7.275 |
Note: The Operating Income data used here is four times the quarterly (Mar. 2023) data.
* 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.
9 Meters Biopharma (OTCPK:NMTRQ) 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, 9 Meters Biopharma's WACC % is 0.00%. 9 Meters Biopharma's ROC % is 0.00% (calculated using TTM income statement data). 9 Meters Biopharma 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.
Thank you for viewing the detailed overview of 9 Meters Biopharma's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Bethany Sensenig | officer: Chief Financial Officer | C/O 9 METERS BIOPHARMA, INC., 8480 HONEYCUTT ROAD, SUITE 120, RALEIGH NC 27615 |
John Temperato | director, officer: Chief Executive Officer | C/O MELINTA THERAPEUTICS,INC., 300 GEORGE STREET, SUITE 301, NEW HAVEN CT 06511 |
Mark A Sirgo | director | C/O BIODELIVERY SCIENCES INTERNATIONAL, 801 CORPORATE CENTER DRIVE -SUITE 210, RALEIGH NC 27607 |
Michael T. Constantino | director | C/O 9 METERS BIOPHARMA, INC., 8480 HONEYCUTT ROAD, SUITE 120, RALEIGH NC 27615 |
Samantha Ventimiglia | director | C/O 9 METERS BIOPHARMA, INC., 8480 HONEYCUTT ROAD, SUITE 120, RALEIGH NC 27615 |
Edward J Sitar | officer: Chief Financial Officer | 39 FLAMING ARROW ROAD, MAHWAH NJ 07430 |
Orbimed Israel Biofund Gp Limited Partnership | 10 percent owner | 601 LEXINGTON AVENUE, 54TH FLOOR, NEW YORK NY 1022-4629 |
Yehuda Michael Rice | director | 155 WALNUT STREET, ENGLEWOOD NJ 07631 |
Nissim Darvish | director, 10 percent owner | C/O INNOVATE BIOPHARMACEUTICALS, INC., 8480 HONEYCUTT ROAD, SUITE 120, RALEIGH NC 27615 |
Orbimed Israel Gp Ltd. | 10 percent owner | 601 LEXINGTON AVENUE, 54TH FLOOR, NEW YORK NY 10022-4629 |
Sandeep Laumas | director, officer: Executive Chairman | 8480 HONEYCUTT RD, SUITE 200, RALEIGH NC 27615 |
Jay P. Madan | director, officer: President | 8480 HONEYCUTT RD, SUITE 200, RALEIGH NC 27615 |
Roy Proujansky | director | 144 PAU NEL DRIVE, LANDENBERG PA 19350 |
Christopher P. Prior | director, officer: Chief Executive Officer | 8480 HONEYCUTT RD, SUITE 200, RALEIGH NC 27615 |
June Sherie Almenoff | officer: COO and Chief Medical Officer | C/O BRAINSTORM CELL THERAPEUTICS INC., 1325 AVENUE OF AMERICAS 28TH FLOOR, NEW YORK NY 10019 |
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