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Lululemon Athletica ROC (Joel Greenblatt) %

: 46.28% (As of Oct. 2020)
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Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits). He defines ROC (Joel Greenblatt) % as EBIT divided by the total of Property, Plant and Equipment and net working capital. Lululemon Athletica's annualized ROC (Joel Greenblatt) % for the quarter that ended in Oct. 2020 was 46.28%.

NAS:LULU' s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: 45.54   Med: 103.34   Max: 272.2
Current: 45.54
45.54
272.2

During the past 13 years, Lululemon Athletica's highest ROC (Joel Greenblatt) % was 272.20%. The lowest was 45.54%. And the median was 103.34%.

NAS:LULU's ROC (Joel Greenblatt) % is ranked higher than
89% of the 1051 Companies
in the Retail - Cyclical industry.

( Industry Median: 6.21 vs. NAS:LULU: 45.54 )

Lululemon Athletica's 5-Year average Growth Rate of ROC (Joel Greenblatt) % was 1.70% per year.

Lululemon Athletica ROC (Joel Greenblatt) % Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Lululemon Athletica Annual Data
Jan11 Jan12 Jan13 Jan14 Jan15 Jan16 Jan17 Jan18 Jan19 Jan20
ROC (Joel Greenblatt) % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 76.71 73.30 80.01 113.70 80.88

Lululemon Athletica Quarterly Data
Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20
ROC (Joel Greenblatt) % 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 42.73 100.51 7.83 31.01 46.28
Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.

Lululemon Athletica ROC (Joel Greenblatt) % Distribution

* The bar in red indicates where Lululemon Athletica's ROC (Joel Greenblatt) % falls into.


Lululemon Athletica ROC (Joel Greenblatt) % Calculation

Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits) . He defines Return on Capital as follows:

ROC (Joel Greenblatt) %=EBIT/Average of (Net fixed Assets + Net Working Capital)

EBIT stands for Earnings Before Interest and Taxes.

Fixed Assets are also known as non-current assets. They include the Property, Plant and Equipment that the firm needs in its operation.

GuruFocus calculates net working capital as: (Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Deferred Revenue + Other Current Liabilities). We're trying to account for OPERATING assets and liabilities (part of daily business) when calculating working capital. Cash and marketable securities are considered NON-OPERATING assets and are not included in calculation. We will also back out all interest bearing debt, short term debt and the portion of long term debt that is due in the current period from the current liabilities. This debt will be considered when computing cost of capital and it would be inappropriate to count it twice.

Working Capital(Q: Jul. 2020 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(48.922 + 672.773 + 212.362) - (370.379 + 106.425 + 138.564)
=318.689

Working Capital(Q: Oct. 2020 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(59.772 + 770.99 + 275.161) - (334.006 + 104.76 + 154.03)
=513.127

When net working capital is negative, 0 is used.

So ROC (Joel Greenblatt) % of Lululemon Athletica for the quarter that ended in Oct. 2020 can be restated as:

ROC (Joel Greenblatt) %(Q: Oct. 2020 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Jul. 2020  Q: Oct. 2020
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=853.804/( ( (1424.319 + max(318.689, 0)) + (1433.966 + max(513.127, 0)) )/ 2 )
=853.804/( ( 1743.008 + 1947.093 )/ 2 )
=853.804/1845.0505
=46.28 %

Note: The EBIT data used here is four times the quarterly (Oct. 2020) EBIT data.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Lululemon Athletica  (NAS:LULU) ROC (Joel Greenblatt) % Explanation

The way Joel Greenblatt defines Return on Capital is a more accurate measure of how efficiently the company generates returns onthe capital actually invested in the business. EBIT is used instead of net income because the tax and interest payment may be affected by factors other than the core business operation. Intangible assets are not included in the calculation because they don't need to be replaced.

Joel Greenblatt uses his definition of Return on Capital and Earnings Yield (Joel Greenblatt) % to rank companies.

Lululemon Athletica ROC (Joel Greenblatt) % Related Terms

Lululemon Athletica ROC (Joel Greenblatt) % Headlines

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