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FinVolution Group ROC %

: 21.05% (As of Mar. 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 %. FinVolution Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2022 was 21.05%.

As of today (2022-06-26), FinVolution Group's WACC % is 8.44%. FinVolution Group's ROC % is 26.31% (calculated using TTM income statement data). FinVolution Group 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.


FinVolution Group ROC % Historical Data

The historical data trend for FinVolution Group'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.

FinVolution Group Annual Data
Trend Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
ROC %
Premium Member Only Premium Member Only 332.90 100.13 47.56 27.83 27.89

FinVolution Group Quarterly Data
Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22
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 29.00 29.52 27.87 25.98 21.05

FinVolution Group ROC % Calculation

FinVolution Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2021 is calculated as:

ROC % (A: Dec. 2021 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2020 ) + Invested Capital (A: Dec. 2021 ))/ count )
=410.36942835162 * ( 1 - 8.8% )/( (1175.0532931659 + 1508.6144474275)/ 2 )
=374.25691865668/1341.8338702967
=27.89 %

where

Invested Capital(A: Dec. 2020 )
=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))
=2275.8070435674 - 396.83559402383 - ( 703.91815637759 - max(0, 589.95152386341 - 2061.0325264172+703.91815637759))
=1175.0532931659

Invested Capital(A: Dec. 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))
=2847.8091784027 - 456.36176659916 - ( 882.83296437599 - max(0, 628.74161995824 - 2574.9768420392+882.83296437599))
=1508.6144474275

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

ROC % (Q: Mar. 2022 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Dec. 2021 ) + Invested Capital (Q: Mar. 2022 ))/ count )
=366.95205371497 * ( 1 - 15.58% )/( (1508.6144474275 + 1434.0541562904)/ 2 )
=309.78092374618/1471.3343018589
=21.05 %

where

Invested Capital(Q: Dec. 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))
=2847.8091784027 - 456.36176659916 - ( 882.83296437599 - max(0, 628.74161995824 - 2574.9768420392+882.83296437599))
=1508.6144474275

Invested Capital(Q: Mar. 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))
=3057.6854332818 - 628.99552375248 - ( 994.63575323897 - max(0, 817.14197900577 - 2758.7704504618+994.63575323897))
=1434.0541562904

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


FinVolution Group  (NYSE:FINV) 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, FinVolution Group's WACC % is 8.44%. FinVolution Group's ROC % is 26.31% (calculated using TTM income statement data). FinVolution Group 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.


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.


FinVolution Group ROC % Related Terms

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FinVolution Group Business Description

FinVolution Group logo
Industry
Financial Services » Credit Services NAICS : 522310 SIC : 6163
Traded in Other Exchanges
Address
No. 999 Dangui Road, Building G1, Pudong New District, Shanghai, CHN, 201203
FinVolution Group is a provider of online consumer finance in China. It offers various loan products, making financial services available to borrowers anytime, anywhere; designs a loan transaction process, and offers Tailored risk-based pricing. It offers short-term loans to borrowers to meet immediate credit needs while allowing them to gradually establish their credit history through activities on the company's platform. The company provides investors with an opportunity to invest in emerging asset class-consumer loans through a variety of investment options. It generates revenues from fees charged to borrowers.

FinVolution Group Headlines

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