Market Cap : 2.42 B | Enterprise Value : 3.57 B | PE Ratio : At Loss | PB Ratio : 1.91 |
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ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Krispy Kreme's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2022 was 1.42%.
As of today (2022-08-11), Krispy Kreme's WACC % is 6.24%. Krispy Kreme's ROIC % is -1.51% (calculated using TTM income statement data). Krispy Kreme earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Krispy Kreme's ROIC % 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.
For the Grocery Stores subindustry, Krispy Kreme's ROIC %, along with its competitors' market caps and ROIC % 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.
For the Retail - Defensive industry and Consumer Defensive sector, Krispy Kreme's ROIC % distribution charts can be found below:
* The bar in red indicates where Krispy Kreme's ROIC % falls into.
Krispy Kreme's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2021 is calculated as:
ROIC % (A: Dec. 2021 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Dec. 2020 ) | + | Invested Capital (A: Dec. 2021 )) | / count ) |
= | 31 * ( 1 - -262.2% ) | / | ( (2983.822 | + | 3075.299) | / 2 ) |
= | 112.282 | / | 3029.5605 | |||
= | 3.71 % |
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 | )) |
= | 3060.995 | - | 410.915 | - | ( 38.508 | - | max(0, 497.835 | - | 164.093 | + | 38.508 | )) |
= | 2983.822 |
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 | )) |
= | 3145.254 | - | 439.215 | - | ( 38.562 | - | max(0, 526.157 | - | 156.897 | + | 38.562 | )) |
= | 3075.299 |
Krispy Kreme's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2022 is calculated as:
ROIC % (Q: Mar. 2022 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Dec. 2021 ) | + | Invested Capital (Q: Mar. 2022 )) | / count ) |
= | 69.152 * ( 1 - 37.04% ) | / | ( (3075.299 | + | 3069.737) | / 2 ) |
= | 43.5380992 | / | 3072.518 | |||
= | 1.42 % |
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 | )) |
= | 3145.254 | - | 439.215 | - | ( 38.562 | - | max(0, 526.157 | - | 156.897 | + | 38.562 | )) |
= | 3075.299 |
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 | )) |
= | 3133.254 | - | 409.106 | - | ( 31.615 | - | max(0, 495.247 | - | 149.658 | + | 31.615 | )) |
= | 3069.737 |
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.
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Krispy Kreme's WACC % is 6.24%. Krispy Kreme's ROIC % is -1.51% (calculated using TTM income statement data).
Like ROE % and ROA %, ROIC % 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 Krispy Kreme's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Andrada Marissa | director | C/O KATE SPADE & COMPANY 2 PARK AVENUE NEW YORK NY 10016 |
Goudet Olivier | director, other: Chairman of the Board | 350 FIFTH AVENUE NEW YORK NY 10118 |
Weese Michelle | director | BRISTOL MYERS SQUIBB ROUTE 206 & PROVINCE LINE ROAD PRINCETON NJ 08543 |
Bell David Charles | director | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Jab Indulgence B.v. | 10 percent owner | 14TH FLOOR, 20 EASTBOURNE TERRACE LONDON X0 W2 6LG |
Zandhuis Terri | officer: Chief People Officer | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Pruitt Joey | officer: Chief Accounting Officer | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Yeagley Henry | director | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Capel Patricia | director | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Kk G.p. | 10 percent owner | 14TH FLOOR, 20 EASTBOURNE TERRACE LONDON X0 W2 6LG |
Tang Catherine | officer: CLO and Corporate Secretary | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Charlesworth Josh | officer: COO and CFO | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Spanjers Matthew | officer: Chief Growth Officer | C/O KRISPY KREME, INC. 2116 HAWKINS STREET CHARLOTTE NC 28203 |
Skena David | officer: Chief Marketing Officer | 150 WEST CHURCH AVENUE MARYVILLE TN 37801 |
Lee Carl E Jr | director | 13515 BALLANTYNE CORPORATE PLACE CHARLOTTE NC 28277 |
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