Red Eagle Mining (TSX:R) ROC % : -8.63% (As of Jun. 2018)

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What is Red Eagle Mining 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 %. Red Eagle Mining's annualized return on capital (ROC %) for the quarter that ended in Jun. 2018 was -8.63%.

As of today (2024-06-10), Red Eagle Mining's WACC % is 0.00%. Red Eagle Mining's ROC % is 0.00% (calculated using TTM income statement data). Red Eagle Mining earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Red Eagle Mining ROC % Historical Data

The historical data trend for Red Eagle Mining'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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Red Eagle Mining ROC % Chart

Red Eagle Mining Annual Data

Trend

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

ROC %

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-173.83

-434.69

-24.34

-9.22

-9.18

Red Eagle Mining Quarterly Data
	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18
ROC %	Get a 7-Day Free Trial															-8.76	-8.76	-9.90	-7.46	-8.63

Red Eagle Mining ROC % Calculation

Red Eagle Mining's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2017 is calculated as:

	ROC % (A: Dec. 2017 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2016 )	+	Invested Capital (A: Dec. 2017 ))	/ count )
=	-17.889 * ( 1 - 0% )	/	( (174.366	+	215.209)	/ 2 )
=	-17.889	/	194.7875
=	-9.18 %

where

	Invested Capital		(A: Dec. 2016 )
=	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	))
=	162.762	-	22.643	-	( 5.605	-	max(0, 46.324	-	12.077	+	5.605	))
=	174.366

	Invested Capital		(A: Dec. 2017 )
=	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	))
=	211.098	-	19.717	-	( 2.268	-	max(0, 39.409	-	15.581	+	2.268	))
=	215.209

Red Eagle Mining's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2018 is calculated as:

	ROC % (Q: Jun. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2018 )	+	Invested Capital (Q: Jun. 2018 ))	/ count )
=	-20.968 * ( 1 - 0% )	/	( (241.472	+	244.695)	/ 2 )
=	-20.968	/	243.0835
=	-8.63 %

where

	Invested Capital		(Q: Mar. 2018 )
=	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	))
=	232.158	-	31.25	-	( 0.824	-	max(0, 58.483	-	17.919	+	0.824	))
=	241.472

	Invested Capital		(Q: Jun. 2018 )
=	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	))
=	151.22	-	37.473	-	( 0.314	-	max(0, 147.243	-	16.295	+	0.314	))
=	244.695

Note: The Operating Income data used here is four times the quarterly (Jun. 2018) data.

Red Eagle Mining (TSX:R) 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, Red Eagle Mining's WACC % is 0.00%. Red Eagle Mining's ROC % is 0.00% (calculated using TTM income statement data). Red Eagle Mining 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.

Red Eagle Mining ROC % Related Terms

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Red Eagle Mining (TSX:R) Business Description

Industry

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Traded in Other Exchanges

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Address

666 Burrard Street, Suite 2348, Vancouver, BC, CAN, V6C 2X8

Website

http://www.redeaglemining.com

Red Eagle Mining Corp is a Canada-based development-stage company. It is engaged in the exploration and development of mineral properties. Geographically it operates in the countries of Canada and Colombia. It focuses on building shareholder value through discovering and developing gold projects with low costs and low technical risks in Colombia. The company primarily explores for Gold and owns interests in the Santa Rosa Gold Project located in Antioquia, Colombia covering an area of approximately 10,000 hectares.