Silver Spruce Resources (Silver Spruce Resources) ROC % : -2,898.11% (As of Jan. 2024)

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What is Silver Spruce Resources 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 %. Silver Spruce Resources's annualized return on capital (ROC %) for the quarter that ended in Jan. 2024 was -2,898.11%.

As of today (2024-05-22), Silver Spruce Resources's WACC % is 14.76%. Silver Spruce Resources's ROC % is -2231.40% (calculated using TTM income statement data). Silver Spruce Resources earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Silver Spruce Resources ROC % Historical Data

The historical data trend for Silver Spruce Resources'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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Silver Spruce Resources ROC % Chart

Silver Spruce Resources Annual Data

Trend

Oct14

Oct15

Oct16

Oct17

Oct18

Oct19

Oct20

Oct21

Oct22

Oct23

ROC %

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-96.26

-932.12

-2,525.17

-1,748.44

-1,759.04

Silver Spruce Resources 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															-1,023.08	-2,286.96	-1,893.67	-2,012.50	-2,898.11

Silver Spruce Resources ROC % Calculation

Silver Spruce Resources's annualized Return on Capital (ROC %) for the fiscal year that ended in Oct. 2023 is calculated as:

	ROC % (A: Oct. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Oct. 2022 )	+	Invested Capital (A: Oct. 2023 ))	/ count )
=	-0.73 * ( 1 - 0% )	/	( (0.055	+	0.028)	/ 2 )
=	-0.73	/	0.0415
=	-1,759.04 %

where

	Invested Capital		(A: Oct. 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	))
=	0.281	-	0.218	-	( 0.162	-	max(0, 0.258	-	0.266	+	0.162	))
=	0.055

	Invested Capital		(A: 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	))
=	0.3	-	0.129	-	( 0.276	-	max(0, 0.155	-	0.298	+	0.276	))
=	0.028

Silver Spruce Resources'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 )
=	-0.768 * ( 1 - 0% )	/	( (0.028	+	0.025)	/ 2 )
=	-0.768	/	0.0265
=	-2,898.11 %

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	))
=	0.3	-	0.129	-	( 0.276	-	max(0, 0.155	-	0.298	+	0.276	))
=	0.028

	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	))
=	0.17	-	0.19	-	( 0.118	-	max(0, 0.215	-	0.17	+	0.118	))
=	0.025

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

Silver Spruce Resources (OTCPK:SSEBF) 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, Silver Spruce Resources's WACC % is 14.76%. Silver Spruce Resources's ROC % is -2231.40% (calculated using TTM income statement data). Silver Spruce Resources 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.

Silver Spruce Resources ROC % Related Terms

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Silver Spruce Resources (Silver Spruce Resources) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » Silver Spruce Resources Inc (OTCPK:SSEBF) » Definitions » ROC %

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Traded in Other Exchanges

S6Q1:Germany SSE:Canada

Address

1600 Bedford Highway, Suite 440, Bedford, NS, CAN, B4A 1E8

Website

https://www.silverspruceresources.com

Silver Spruce Resources Inc is a Canada-based company focused on exploration for precious and base minerals. The flagship project Pino de Plata located in Chihuahua state Mexico is a high-grade silver project with noteworthy gold, lead, and zinc credits. Its other projects include El Mezquite, Melchett Lake and Pope's Hill.