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Nutanix (NAS:NTNX) ROC %

: -20.22% (As of Oct. 2022)
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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Nutanix's annualized return on capital (ROC %) for the quarter that ended in Oct. 2022 was -20.22%.

As of today (2023-01-29), Nutanix's WACC % is 13.39%. Nutanix's ROC % is -25.84% (calculated using TTM income statement data). Nutanix earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Nutanix ROC % Historical Data

The historical data trend for Nutanix'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.

* Premium members only.

Nutanix Annual Data
Trend Jul13 Jul14 Jul15 Jul16 Jul17 Jul18 Jul19 Jul20 Jul21 Jul22
ROC %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -52.76 -73.34 -75.70 -49.09 -29.95

Nutanix Quarterly Data
Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22
ROC % 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 Premium Member Only Premium Member Only Premium Member Only -38.18 -25.57 -23.19 -33.57 -20.22

Nutanix ROC % Calculation

Nutanix's annualized Return on Capital (ROC %) for the fiscal year that ended in Jul. 2022 is calculated as:

ROC % (A: Jul. 2022 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Jul. 2021 ) + Invested Capital (A: Jul. 2022 ))/ count )
=-457.444 * ( 1 - -2.48% )/( (1455.536 + 1674.907)/ 2 )
=-468.7886112/1565.2215
=-29.95 %

where

Invested Capital(A: Jul. 2021 )
=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))
=2277.496 - 187.587 - ( 1213.729 - max(0, 927.888 - 1562.261+1213.729))
=1455.536

Invested Capital(A: Jul. 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))
=2365.749 - 183.085 - ( 1324.279 - max(0, 1150.224 - 1657.981+1324.279))
=1674.907

Nutanix's annualized Return on Capital (ROC %) for the quarter that ended in Oct. 2022 is calculated as:

ROC % (Q: Oct. 2022 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Jul. 2022 ) + Invested Capital (Q: Oct. 2022 ))/ count )
=-321.028 * ( 1 - -5.81% )/( (1674.907 + 1684.512)/ 2 )
=-339.6797268/1679.7095
=-20.22 %

where

Invested Capital(Q: Jul. 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))
=2365.749 - 183.085 - ( 1324.279 - max(0, 1150.224 - 1657.981+1324.279))
=1674.907

Invested Capital(Q: Oct. 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))
=2357.422 - 148.614 - ( 1388.058 - max(0, 1147.799 - 1672.095+1388.058))
=1684.512

Note: The Operating Income data used here is four times the quarterly (Oct. 2022) 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.


Nutanix  (NAS:NTNX) 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, Nutanix's WACC % is 13.39%. Nutanix's ROC % is -25.84% (calculated using TTM income statement data). Nutanix 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.


Nutanix ROC % Related Terms

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Nutanix (NAS:NTNX) Business Description

Nutanix logo
Traded in Other Exchanges
Address
1740 Technology Drive, Suite 150, San Jose, CA, USA, 95110
Nutanix Inc provides native hybrid cloud capabilities for businesses. The company offers Enterprise Cloud Platform to businesses for various uses such as web-scale engineering and consumer-grade design, virtualization, and storage into a resilient, and software-defined solution. Geographically, it derives a majority of revenue from the United States and also has a presence in Europe, the Middle East, Asia Pacific, Africa, and other regions.
Executives
Sivaraman Rukmini officer: Chief Financial Officer 1740 TECHNOLOGY DR., SUITE 150 SAN JOSE CA 95110
Sheppard Teresa Gayle director C/O ENVISTA HOLDINGS CORPORATION 200 S. KRAEMER BLVD., BLDG. E BREA CA 92821
Bostrom Susan L director
Conway Craig director SALESFORCE TOWER 415 MISSION STREET, 3RD FLOOR SAN FRANCISCO CA 94105
Stevens Brian Mark director 25 HOOPER HILL RD. NEW BOSTON NH 03070
Gambale Virginia director C/O JETBLUE AIRWAYS CORP. 27-01 QUEENS PLAZA NORTH LONG ISLAND CITY NY 11101
Ramaswami Rajiv director, officer: President and CEO 5300 CALIFORNIA AVENUE IRVINE CA 92617
Kaddaras Christopher Nicholas Jr officer: Chief Revenue Officer C/O NUTANIX, INC. 1740 TECHNOLOGY DR., STE 150 SAN JOSE CA 95110
Wall Tyler officer: Chief Legal Officer CHORDIANT SOFTWARE, INC. 20400 STEVENS CREEK BLVD., STE. 400 CUPERTINO CA 94014
Boynton Aaron officer: Chief Accounting Officer C/O NUTANIX, INC. 1740 TECHNOLOGY AVE., SUITE 150 SAN JOSE CA 95110
Maner Tarkan officer: Chief Commercial Officer C/O NUTANIX, INC. 1740 TECHNOLOGY AVE., SUITE 150 SAN JOSE CA 95110
Humphrey David director C/O BAIN CAPITAL PARTNERS, LLC JOHN HANCOCK TOWER, 200 CLARENDON STREET BOSTON MA 02116
De Groen Max Pieter director 200 CLARENDON STREET BOSTON MA 02116
Abbasi Sohaib director 100 EAST DAVIE STREET RALEIGH NC 27601
Attanasio Louis J officer: Chief Revenue Officer 1740 TECHNOLOGY AVE., SUITE 150 SAN JOSE CA 95110

Nutanix (NAS:NTNX) Headlines

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