Golden Minerals Co (TSX:AUMN) ROC % : -84.16% (As of Mar. 2024)

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What is Golden Minerals Co 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 %. Golden Minerals Co's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -84.16%.

As of today (2024-05-22), Golden Minerals Co's WACC % is 0.63%. Golden Minerals Co's ROC % is -89.82% (calculated using TTM income statement data). Golden Minerals Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Golden Minerals Co ROC % Historical Data

The historical data trend for Golden Minerals Co'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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Golden Minerals Co ROC % Chart

Golden Minerals Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-51.59

-90.70

-18.25

-102.49

-106.13

Golden Minerals Co Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial															-127.86	-71.15	-139.62	-65.83	-84.16

Golden Minerals Co ROC % Calculation

Golden Minerals Co's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-12.235 * ( 1 - -0.12% )	/	( (12.351	+	10.734)	/ 2 )
=	-12.249682	/	11.5425
=	-106.13 %

where

	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	))
=	20.301	-	3.031	-	( 5.423	-	max(0, 5.908	-	10.827	+	5.423	))
=	12.351

	Invested Capital		(A: Dec. 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	))
=	20.003	-	5.189	-	( 4.862	-	max(0, 7.611	-	11.691	+	4.862	))
=	10.734

Golden Minerals Co's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	-9.404 * ( 1 - 0% )	/	( (10.734	+	11.614)	/ 2 )
=	-9.404	/	11.174
=	-84.16 %

where

	Invested Capital		(Q: Dec. 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	))
=	20.003	-	5.189	-	( 4.862	-	max(0, 7.611	-	11.691	+	4.862	))
=	10.734

	Invested Capital		(Q: Mar. 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	))
=	15.37	-	5.398	-	( 3.296	-	max(0, 8.858	-	7.216	+	3.296	))
=	11.614

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

Golden Minerals Co (TSX:AUMN) 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, Golden Minerals Co's WACC % is 0.63%. Golden Minerals Co's ROC % is -89.82% (calculated using TTM income statement data). Golden Minerals Co 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.

Golden Minerals Co ROC % Related Terms

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Golden Minerals Co (TSX:AUMN) Business Description

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AUMN:USA

Address

350 Indiana Street, Suite 650, Golden, CO, USA, 80401

Website

https://www.goldenminerals.com

Golden Minerals Co is an exploration stage company engaged in the mining, construction, and exploration of precious metals and mineral properties. It owns and operates Velardena and Chicago precious metals mining properties and associated oxide and sulfide processing plants in the State of Durango, Mexico, the El Quevar exploration property in the province of Salta, Argentina, and a diversified portfolio of precious metals and other mineral exploration properties located in or near historical precious metals producing regions of Mexico. The company's business is structured into two divisions, Mexico operations, and Corporate Exploration and Other.