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McKesson ROC (Joel Greenblatt) %

: 114.85% (As of Jun. 2022)
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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. McKesson's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2022 was 114.85%.

The historical rank and industry rank for McKesson's ROC (Joel Greenblatt) % or its related term are showing as below:

MCK' s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: -107.86   Med: 95.57   Max: 315.05
Current: 65.03

During the past 13 years, McKesson's highest ROC (Joel Greenblatt) % was 315.05%. The lowest was -107.86%. And the median was 95.57%.

MCK's ROC (Joel Greenblatt) % is ranked better than
87.8% of 82 companies
in the Medical Distribution industry
Industry Median: 18.98 vs MCK: 65.03

McKesson's 5-Year average Growth Rate of ROC (Joel Greenblatt) % was 0.00% per year.


McKesson ROC (Joel Greenblatt) % Historical Data

The historical data trend for McKesson's ROC (Joel Greenblatt) % 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.

McKesson Annual Data
Trend Mar13 Mar14 Mar15 Mar16 Mar17 Mar18 Mar19 Mar20 Mar21 Mar22
ROC (Joel Greenblatt) %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 21.95 34.88 40.98 -107.86 50.62

McKesson Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 52.55 45.25 33.32 75.77 114.85

Competitive Comparison

For the Medical Distribution subindustry, McKesson's ROC (Joel Greenblatt) %, along with its competitors' market caps and ROC (Joel Greenblatt) % data, can be viewed below:

* 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. Note that "N/A" values will not show up in the chart.

   

McKesson ROC (Joel Greenblatt) % Distribution

For the Medical Distribution industry and Healthcare sector, McKesson's ROC (Joel Greenblatt) % distribution charts can be found below:

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



McKesson 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: Mar. 2022 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(16438 + 18702 + 5414) - (42629 + 0 + 4741)
=-6816

Working Capital(Q: Jun. 2022 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(19900 + 19505 + 3745) - (43785 + 0 + 2324)
=-2959

When net working capital is negative, 0 is used.

So ROC (Joel Greenblatt) % of McKesson for the quarter that ended in Jun. 2022 can be restated as:

ROC (Joel Greenblatt) %(Q: Jun. 2022 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Mar. 2022  Q: Jun. 2022
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=4204/( ( (3640 + max(-6816, 0)) + (3681 + max(-2959, 0)) )/ 2 )
=4204/( ( 3640 + 3681 )/ 2 )
=4204/3660.5
=114.85 %

Note: The EBIT data used here is four times the quarterly (Jun. 2022) EBIT 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.


McKesson  (NYSE:MCK) 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.


McKesson ROC (Joel Greenblatt) % Related Terms

Thank you for viewing the detailed overview of McKesson's ROC (Joel Greenblatt) % provided by GuruFocus.com. Please click on the following links to see related term pages.


McKesson Business Description

McKesson logo
Address
6555 State Highway 161, Irving, TX, USA, 75039
McKesson is a leading wholesaler of branded, generic, and specialty pharmaceutical products to pharmacies (retail chains, independent, and mail order), hospitals networks, and healthcare providers. Along with AmerisourceBergen and Cardinal Health, the three account for well over 90% of the U.S. pharmaceutical wholesale industry. McKesson is currently divesting from its pharmaceutical wholesale and distribution in Europe and Canada in order to redeploy capital to strategic growth areas in the U.S. (oncology network and ecosystem, and biopharma services). Additionally, the company supplies medical-surgical products and equipment to healthcare facilities and provides a variety of technology solutions for pharmacies.
Executives
Rodgers Thomas L officer: EVP, Chief Strategy & BDO 6555 NORTH STATE HWY 161 IRVING TX 75039
Dunbar Webster Roy director 5757 N. GREEN BAY AVENUE MILWAUKEE WI 53209
Rutledge Napoleon B Jr officer: SVP, Controller & CAO 2999 WILDWOOD PARKWAY ATLANTA GA 30339
Flores Nancy officer: EVP, CIO & CTO 6555 NORTH STATE HWY 161 IRVING TX 75039
Hinton James H. director 6555 NORTH STATE HWY. 161 IRVING TX 75039
Wilson-thompson Kathleen director PO BOX 3599 BATTLE CREEK MI 49016-3599
Faber Tracy officer: EVP & Chief HR Officer 6555 NORTH STATE HWY 161 IRVING TX 75039
Tyler Brian S. officer: Chief Executive Officer MCKESSON CORPORATION 6555 STATE HWY 161 IRVING TX 75039
Schechter Lori A. officer: EVP, Chief Legal Officer & GC MCKESSON CORPORATION 6555 NORTH STATE HWY 161 IRVING TX 75039
Vitalone Britt J. officer: EVP & CFO MCKESSON CORPORATION 6555 STATE HWY 161 IRVING TX 75039
Emerson Kevin officer: SVP, Controller & CAO 6555 NORTH STATE HWY 161 IRVING TX 75039
Carmona Richard H director 1221 BROADWAY OAKLAND CA 94612
Mantia Linda Provie director C/O CERIDIAN HCM HOLDING INC., 3311 EAST OLD SHAKOPEE ROAD MINNEAPOLIS MN 55425
Martinez Maria director THE LANDMARK @ 1 MARKET STREET SUITE 300 SAN FRANCISCO CA 94105
Washington Kenneth E director 6555 STATE HWY 161 IRVING TX 75039

McKesson Headlines

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