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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 %. Sportsman's Warehouse Holdings's annualized return on capital (ROC %) for the quarter that ended in Jan. 2024 was -3.03%.
As of today (2024-06-04), Sportsman's Warehouse Holdings's WACC % is 2.97%. Sportsman's Warehouse Holdings's ROC % is -2.39% (calculated using TTM income statement data). Sportsman's Warehouse Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Sportsman's Warehouse Holdings'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.
Sportsman's Warehouse Holdings Annual Data | |||||||||||||||||||||
Trend | Jan15 | Jan16 | Jan17 | Jan18 | Jan19 | Jan20 | Jan21 | Jan22 | Jan23 | Jan24 | |||||||||||
ROC % | Get a 7-Day Free Trial | 6.13 | 18.95 | 12.50 | 6.32 | -2.54 |
Sportsman's Warehouse Holdings Quarterly Data | ||||||||||||||||||||
Apr19 | Jul19 | Oct19 | Jan20 | Apr20 | Jul20 | Oct20 | Jan21 | Apr21 | Jul21 | Oct21 | Jan22 | Apr22 | Jul22 | Oct22 | Jan23 | Apr23 | Jul23 | Oct23 | Jan24 | |
ROC % | Get a 7-Day Free Trial | 6.71 | -7.30 | -0.47 | 2.21 | -3.03 |
Sportsman's Warehouse Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Jan. 2024 is calculated as:
ROC % (A: Jan. 2024 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Jan. 2023 ) | + | Invested Capital (A: Jan. 2024 )) | / count ) |
= | -25.337 * ( 1 - 24.1% ) | / | ( (734.918 | + | 781.195) | / 2 ) |
= | -19.230783 | / | 758.0565 | |||
= | -2.54 % |
where
Invested Capital | (A: Jan. 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 | )) |
= | 858.96 | - | 121.653 | - | ( 2.389 | - | max(0, 295.824 | - | 425.896 | + | 2.389 | )) |
= | 734.918 |
Invested Capital | (A: Jan. 2024 ) | |||||||||||
= | 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 | )) |
= | 886.205 | - | 101.869 | - | ( 3.141 | - | max(0, 314.649 | - | 380.048 | + | 3.141 | )) |
= | 781.195 |
Sportsman's Warehouse Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Jan. 2024 is calculated as:
ROC % (Q: Jan. 2024 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Oct. 2023 ) | + | Invested Capital (Q: Jan. 2024 )) | / count ) |
= | -31.732 * ( 1 - 22.55% ) | / | ( (839.701 | + | 781.195) | / 2 ) |
= | -24.576434 | / | 810.448 | |||
= | -3.03 % |
where
Invested Capital | (Q: Oct. 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 | )) |
= | 980.304 | - | 137.688 | - | ( 2.915 | - | max(0, 405.789 | - | 482.581 | + | 2.915 | )) |
= | 839.701 |
Invested Capital | (Q: Jan. 2024 ) | |||||||||||
= | 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 | )) |
= | 886.205 | - | 101.869 | - | ( 3.141 | - | max(0, 314.649 | - | 380.048 | + | 3.141 | )) |
= | 781.195 |
Note: The Operating Income data used here is four times the quarterly (Jan. 2024) 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.
Sportsman's Warehouse Holdings (NAS:SPWH) 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, Sportsman's Warehouse Holdings's WACC % is 2.97%. Sportsman's Warehouse Holdings's ROC % is -2.39% (calculated using TTM income statement data). Sportsman's Warehouse Holdings 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.
Thank you for viewing the detailed overview of Sportsman's Warehouse Holdings's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Paul Stone | director, officer: PRESIDENT AND CEO | HERTZ GLOBAL HOLDINGS, INC., 8501 WILLIAMS ROAD, ESTERO FL 33928 |
Steven W. Sansom | director | 1475 WEST 9000 SOUTH, SUITE A, WEST JORDAN UT 84088 |
Richard D Mcbee | director | PO BOX 500 (M/S 55-985), 14200 SW KARL BRAUN DRIVE, BEAVERTON OR 97077-0001 |
Gregory P Hickey | director | C/O SPORTSMAN'S WAREHOUSE HOLDINGS, INC., 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047 |
Cannell Capital Llc | 10 percent owner | 245 MERIWETHER CIRCLE, ALTA WY 83414 |
Erica Fortune | director | C/O SPORTMAN'S WAREHOUSE HOLDINGS, INC., 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047 |
Jon Barker | officer: President and COO | C/O SPORTSMAN'S WAREHOUSE HOLDINGS, INC., 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047 |
Nancy A Walsh | director | LL FLOORING HOLDINGS, INC., 4901 BAKERS MILL LANE, RICHMOND VA 23230 |
Joseph P Schneider | director | C/O LACROSSE FOOTWEAR INC, 18550 NE RIVERSIDE PARKWAY, PORTLAND OR 972304975 |
Jeffrey Justin White | officer: VP Finance, CAO, Interim CFO | SPORTSMAN'S WAREHOUSE, 1475 WEST 9000 SOUTH SUITE A, WEST JORDAN UT 84088 |
Christopher Eastland | director | C/O SEIDLER KUTSENDA MANAGEMENT COMPANY, 4640 ADMIRALTY WAY, SUITE 1200, MARINA DEL REY CA 90292 |
Robert K. Julian | officer: Chief Financial Officer | C/O SPORTSMAN'S WAREHOUSE, 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047 |
Martha Helena Bejar | director | C/O POLYCOM, INC., 6001 AMERICA CENTER DRIVE, SAN JOSE CA 95002 |
Kent Vernon Graham | director | 11727 FOLKSTONE LANE, LOS ANGELES CA 90077 |
Philip Williamson | director | C/O SPORTSMAN'S WAREHOUSE HOLDINGS, INC., 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047 |
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