Sentinel Energy Services (Sentinel Energy Services) ROC % : 0.84% (As of Sep. 2019)

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What is Sentinel Energy Services 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 %. Sentinel Energy Services's annualized return on capital (ROC %) for the quarter that ended in Sep. 2019 was 0.84%.

As of today (2024-04-26), Sentinel Energy Services's WACC % is 0.00%. Sentinel Energy Services's ROC % is 0.00% (calculated using TTM income statement data). Sentinel Energy Services earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Sentinel Energy Services ROC % Historical Data

The historical data trend for Sentinel Energy Services'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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Sentinel Energy Services ROC % Chart

Sentinel Energy Services Annual Data

Trend

Dec17

Dec18

ROC %

-1.04

Sentinel Energy Services Quarterly Data
	May17	Sep17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19
ROC %	Get a 7-Day Free Trial				-1.10	-2.72	-0.97	-3.57	0.84

Sentinel Energy Services ROC % Calculation

Sentinel Energy Services's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2018 is calculated as:

	ROC % (A: Dec. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2017 )	+	Invested Capital (A: Dec. 2018 ))	/ count )
=	-3.629 * ( 1 - 0.6% )	/	( (345.163	+	350.123)	/ 2 )
=	-3.607226	/	347.643
=	-1.04 %

where

	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	))
=	346.075	-	0.02	-	( 0.892	-	max(0, 0.02	-	1.075	+	0.892	))
=	345.163

	Invested Capital		(A: Dec. 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	))
=	350.361	-	2.821	-	( 0.146	-	max(0, 2.821	-	0.238	+	0.146	))
=	350.123

Sentinel Energy Services's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2019 is calculated as:

	ROC % (Q: Sep. 2019 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2019 )	+	Invested Capital (Q: Sep. 2019 ))	/ count )
=	3.124 * ( 1 - 4.1% )	/	( (355.471	+	357.228)	/ 2 )
=	2.995916	/	356.3495
=	0.84 %

where

	Invested Capital		(Q: Jun. 2019 )
=	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	))
=	355.161	-	6.116	-	( 0.614	-	max(0, 7.115	-	0.689	+	0.614	))
=	355.471

	Invested Capital		(Q: Sep. 2019 )
=	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	))
=	356.437	-	4.959	-	( 0.18	-	max(0, 5.959	-	0.209	+	0.18	))
=	357.228

Note: The Operating Income data used here is four times the quarterly (Sep. 2019) data.

Sentinel Energy Services (NAS:STNL) 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, Sentinel Energy Services's WACC % is 0.00%. Sentinel Energy Services's ROC % is 0.00% (calculated using TTM income statement data). Sentinel Energy Services 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.

Sentinel Energy Services ROC % Related Terms

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