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Badger Meter (FRA:33B) ROIC % : 25.81% (As of Sep. 2024)


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What is Badger Meter ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Badger Meter's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 25.81%.

As of today (2024-10-31), Badger Meter's WACC % is 10.04%. Badger Meter's ROIC % is 25.09% (calculated using TTM income statement data). Badger Meter generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.


Badger Meter ROIC % Historical Data

The historical data trend for Badger Meter's ROIC % 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.

* Premium members only.

Badger Meter ROIC % Chart

Badger Meter Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROIC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 13.73 13.38 16.45 17.16 21.10

Badger Meter Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
ROIC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 22.95 21.18 24.99 27.87 25.81

Competitive Comparison of Badger Meter's ROIC %

For the Scientific & Technical Instruments subindustry, Badger Meter's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Badger Meter's ROIC % Distribution in the Hardware Industry

For the Hardware industry and Technology sector, Badger Meter's ROIC % distribution charts can be found below:

* The bar in red indicates where Badger Meter's ROIC % falls into.



Badger Meter ROIC % Calculation

Badger Meter's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

ROIC % (A: Dec. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2022 ) + Invested Capital (A: Dec. 2023 ))/ count )
=108.132 * ( 1 - 24.08% )/( (371.516 + 406.534)/ 2 )
=82.0938144/389.025
=21.10 %

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))
=569.276 - 67.439 - ( 130.321 - max(0, 104.135 - 328.353+130.321))
=371.516

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))
=657.415 - 75.017 - ( 175.864 - max(0, 120.996 - 405.476+175.864))
=406.534

Badger Meter's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2024 is calculated as:

ROIC % (Q: Sep. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Jun. 2024 ) + Invested Capital (Q: Sep. 2024 ))/ count )
=146.36 * ( 1 - 25.34% )/( (426.446 + 420.34)/ 2 )
=109.272376/423.393
=25.81 %

where

Invested Capital(Q: Jun. 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))
=725.791 - 89.194 - ( 210.151 - max(0, 128.313 - 473.063+210.151))
=426.446

Invested Capital(Q: Sep. 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))
=723.378 - 69.72 - ( 233.318 - max(0, 116.376 - 476.896+233.318))
=420.34

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


Badger Meter  (FRA:33B) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Badger Meter's WACC % is 10.04%. Badger Meter's ROIC % is 25.09% (calculated using TTM income statement data). Badger Meter generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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. Badger Meter 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 %, ROIC % 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.


Badger Meter ROIC % Related Terms

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Badger Meter Business Description

Traded in Other Exchanges
Address
4545 West Brown Deer Road, Milwaukee, WI, USA, 53233
Badger Meter Inc is an innovator, manufacturer, and marketer of products incorporating flow measurement, quality, control, and other system solutions serving markets. The company's products measure water, oil, chemicals, and other fluids, and provide and communicate timely measurement data. Badger's product lines include two categories: sales of water meters, radios, software, and related technologies, and water quality monitoring solutions to water utilities (utility water) and sales of meters and other sensing instruments, valves, software, and other solutions for industrial applications in water, wastewater, and other industries (flow instrumentation). It derives a majority of its revenues from the United States.

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