Exelis (FRA:6EX) ROIC % : 7.61% (As of Mar. 2015)

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What is Exelis 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 %. Exelis's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2015 was 7.61%.

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

Exelis ROIC % Historical Data

The historical data trend for Exelis'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.

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Exelis ROIC % Chart

Exelis Annual Data

Trend

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

ROIC %

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12.20

8.32

8.77

5.21

7.34

Exelis Quarterly Data
	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15
ROIC %	Get a 7-Day Free Trial															4.68	7.05	6.52	8.29	7.61

Competitive Comparison of Exelis's ROIC %

For the Aerospace & Defense subindustry, Exelis'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.

Exelis's ROIC % Distribution in the Aerospace & Defense Industry

For the Aerospace & Defense industry and Industrials sector, Exelis's ROIC % distribution charts can be found below:

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

Exelis ROIC % Calculation

Exelis's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2014 is calculated as:

	ROIC % (A: Dec. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2013 )	+	Invested Capital (A: Dec. 2014 ))	/ count )
=	321.967 * ( 1 - 36.99% )	/	( (2610.48	+	2914.734)	/ 2 )
=	202.8714067	/	2762.607
=	7.34 %

where

	Invested Capital		(A: Dec. 2013 )
=	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	))
=	3565.32	-	619.77	-	( 335.07	-	max(0, 762.12	-	1270.2	+	335.07	))
=	2610.48

	Invested Capital		(A: Dec. 2014 )
=	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	))
=	3956.058	-	627.714	-	( 413.61	-	max(0, 627.714	-	1347.882	+	413.61	))
=	2914.734

Exelis's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2015 is calculated as:

	ROIC % (Q: Mar. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2014 )	+	Invested Capital (Q: Mar. 2015 ))	/ count )
=	384.384 * ( 1 - 37.89% )	/	( (2914.734	+	3361.512)	/ 2 )
=	238.7409024	/	3138.123
=	7.61 %

where

	Invested Capital		(Q: Dec. 2014 )
=	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	))
=	3956.058	-	627.714	-	( 413.61	-	max(0, 627.714	-	1347.882	+	413.61	))
=	2914.734

	Invested Capital		(Q: Mar. 2015 )
=	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	))
=	4463.844	-	659.736	-	( 442.596	-	max(0, 659.736	-	1538.46	+	442.596	))
=	3361.512

Note: The Operating Income data used here is four times the quarterly (Mar. 2015) data.

Exelis (FRA:6EX) 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, Exelis's WACC % is 0.00%. Exelis's ROIC % is 0.00% (calculated using TTM income statement data).

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.

Exelis ROIC % Related Terms

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Exelis (FRA:6EX) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Aerospace & Defense » Exelis Inc (FRA:6EX) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

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Address

Website

http://www.exelisinc.com

Exelis Inc was incorporated in the state of Indiana on May 4, 2011. The Company is a diversified aerospace, defense, information and services Company. The Company operates in two segments: Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) Electronics and Systems and Information and Technical Services to military, government and commercial customers in the United States and internationally. The C4ISR Electronics and Systems segment provides engineered systems and solutions, including: ISR systems; integrated electronic warfare systems; radar and sonar systems; electronic attack and release systems; communications solutions; space systems; and composite aerostructures, for government and commercial customers. The Information and Technical Services segment provides a broad range of service solutions, including: systems integration; network design and development; air traffic management; cyber; intelligence; operations; sustainment; advanced engineering; logistics; and space launch and range-support, for U.S. military and U.S. Government customers. The C4ISR Electronics and Systems' products are classified into Intelligence, Surveillance and Reconnaissance Systems, Integrated Electronic Warfare Systems, Electronic Attack and Release Systems, Radar, Reconnaissance and Undersea Systems, Communications Solutions, Night Vision, Positioning, Navigation and Timing, Aerostructures, and Specialty Applications. Information and Technical Services product lines are classified into Advanced Information Solutions, Civil and Aerospace Systems, Command, Control and Communications Systems, Infrastructure Asset Management, Logistics and Supply Chain Management, and Information Technology and Network Communication Services. The Company's customers include the United States Department of Defense, including U.S. Army, Navy, Marines and Air Force, U.S. Government intelligence agencies, National Aeronautics and Space Administration, Federal Aviation Administration. The Company competes against companies such as Lockheed Martin Corporation, The Boeing Company, Raytheon Company, General Dynamics Corporation, L-3 Communications Corporation, SAIC Inc., Northrop Grumman Corporation, Harris Corporation and BAE Systems, Inc. Internationally, it also competes against these same companies as well as Thales Group, EADS N.V., Finmeccanica S.p.A., among others The Company is subject to federal, state and local environmental laws and regulations.

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