MPLX LP (MPLX LP) ROC %

: 12.41% (As of Dec. 2023)

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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 %. MPLX LP's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 12.41%.

As of today (2024-04-23), MPLX LP's WACC % is 6.65%. MPLX LP's ROC % is 11.94% (calculated using TTM income statement data). MPLX LP 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.

MPLX LP ROC % Historical Data

The historical data trend for MPLX LP'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.

MPLX LP Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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8.41

8.91

10.41

11.29

11.86

MPLX LP Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial															4.91	12.17	11.75	11.57	12.41

MPLX LP ROC % Calculation

MPLX LP's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	4174 * ( 1 - 0.28% )	/	( (35041	+	35156)	/ 2 )
=	4162.3128	/	35098.5
=	11.86 %

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	))
=	35665	-	1120	-	( 238	-	max(0, 2401	-	1905	+	238	))
=	35041

	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	))
=	36529	-	1189	-	( 1048	-	max(0, 2624	-	2808	+	1048	))
=	35156

MPLX LP's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	4348 * ( 1 - 0.78% )	/	( (34369	+	35156)	/ 2 )
=	4314.0856	/	34762.5
=	12.41 %

where

	Invested Capital		(Q: Sep. 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	))
=	36120	-	791	-	( 960	-	max(0, 1399	-	2736	+	960	))
=	34369

	Invested Capital		(Q: 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	))
=	36529	-	1189	-	( 1048	-	max(0, 2624	-	2808	+	1048	))
=	35156

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

MPLX LP (NYSE:MPLX) 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, MPLX LP's WACC % is 6.65%. MPLX LP's ROC % is 11.94% (calculated using TTM income statement data). MPLX LP 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.

MPLX LP ROC % Related Terms

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MPLX LP (MPLX LP) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » MPLX LP (NYSE:MPLX) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

MPLXP.PFD:USA

Address

200 East Hardin Street, Findlay, OH, USA, 45840-3229

Website

https://www.mplx.com

MPLX is a partnership that owns both pipelines and gathering and processing assets with extensive holdings in the Appalachian region. The asset base is made up of pipeline assets dropped down from Marathon Petroleum, its sponsor, and gathering and processing assets from MarkWest, which it acquired in 2015. MPLX also acquired Andeavor Logistics in July 2019.

Executives

Christine S Breves	director	600 GRANT STREET, SUITE 6100, PITTSBURGH PA 16059
Shawn M Lyon	officer: Senior VP, Log. & Storage	C/O MPLX, 200 E HARDIN STREET, FINDLAY OH 45840
Gregory Scott Floerke	officer: Exec VP and CCO	C/O MARKWEST ENERGY PARTNERS, L.P., 1515 ARAPAHOE STREET, TOWER 1, SUITE 160, DENVER CO 80202
Frank M Semple	director, officer: Vice Chairman	1515 ARAPAHOE ST., TOWER 2, SUITE 700, DENVER CO 80202
Kelly D Wright	officer: VP and Controller	C/O MPLX LP, 200 E HARDIN STREET, FINDLAY OH 45840
John J Quaid	officer: Exec VP and CFO	C/O MARATHON PETROLEUM CORPORATION, 539 SOUTH MAIN STREET, FINDLAY OH 45840
Maryann T. Mannen	director	C/O MARATHON PETROLEUM CORPORATION, 539 SOUTH MAIN ST, FINDLAY OH 45840
Ttc Holdings Llc	10 percent owner	539 SOUTH MAIN STREET, FINDLAY OH 45840
Timothy J Aydt	officer: Chief Comm. Ofc.,Exec. VP	C/O MPLX LP, 200 E. HARDIN STREET, FINDLAY OH 45840
Garry L. Peiffer	director, officer: President	C/O MARATHON PETROLEUM CORPORATION, 539 S. MAIN STREET, FINDLAY OH 45840
Gary R Heminger	director, officer: Chief Executive Officer	C/O MARATHON PETROLEUM CORPORATION, 539 S. MAIN STREET, FINDLAY OH 45840
Dan D Sandman	director
Tesoro Logistics Gp, Llc	other: Less than 10% owner	200 E. HARDIN STREET, FINDLAY OH 45840
Western Refining, Inc.	10 percent owner	539 SOUTH MAIN STREET, FINDLAY OH 45840-3229
Tesoro Refining & Marketing Co Llc	other: Less than 10% owner	539 SOUTH MAIN STREET, FINDLAY OH 45840-3229