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Lakeland Industries ROIC %

: 40.37% (As of Jan. 2021)
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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 %. Lakeland Industries's annualized return on invested capital (ROIC %) for the quarter that ended in Jan. 2021 was 40.37%.

As of today (2021-05-18), Lakeland Industries's WACC % is 1.21%. Lakeland Industries's ROIC % is 46.34% (calculated using TTM income statement data). Lakeland Industries 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.


Lakeland Industries ROIC % Historical 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.

* Premium members only.

Lakeland Industries Annual Data
Jan12 Jan13 Jan14 Jan15 Jan16 Jan17 Jan18 Jan19 Jan20 Jan21
ROIC % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.93 0.64 2.08 4.53 46.24

Lakeland Industries Quarterly Data
Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21
ROIC % 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 6.18 46.17 50.53 48.68 40.37

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.


Lakeland Industries ROIC % Distribution

* The bar in red indicates where Lakeland Industries's ROIC % falls into.



Lakeland Industries ROIC % Calculation

Lakeland Industries's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Jan. 2021 is calculated as:

ROIC % (A: Jan. 2021 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Jan. 2020 ) + Invested Capital (A: Jan. 2021 ))/ count )
=43.853 * ( 1 - 20% )/( (75.15 + 76.605)/ 2 )
=35.0824/75.8775
=46.24 %

where

Lakeland Industries's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Jan. 2021 is calculated as:

ROIC % (Q: Jan. 2021 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Oct. 2020 ) + Invested Capital (Q: Jan. 2021 ))/ count )
=37.024 * ( 1 - 14.99% )/( (79.315 + 76.605)/ 2 )
=31.4741024/77.96
=40.37 %

where

Note: The Operating Income data used here is four times the quarterly (Jan. 2021) 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.


Lakeland Industries  (NAS:LAKE) ROIC % Explanation

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, Lakeland Industries's WACC % is 1.21%. Lakeland Industries's ROIC % is 46.34% (calculated using TTM income statement data). Lakeland Industries 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. Lakeland Industries 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 %, 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.


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