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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 %. OncoMed Pharmaceuticals's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2018 was -114.29%.
As of today (2024-04-26), OncoMed Pharmaceuticals's WACC % is 0.00%. OncoMed Pharmaceuticals's ROIC % is 0.00% (calculated using TTM income statement data). OncoMed Pharmaceuticals earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for OncoMed Pharmaceuticals'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.
OncoMed Pharmaceuticals Annual Data | |||||||||||||||||||
Trend | Dec10 | Dec11 | Dec12 | Dec13 | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | ||||||||||
ROIC % | Get a 7-Day Free Trial | -124.43 | -206.86 | -236.06 | -61.64 | -16.14 |
OncoMed Pharmaceuticals Quarterly Data | ||||||||||||||||||||
Mar14 | Jun14 | Sep14 | Dec14 | Mar15 | Jun15 | Sep15 | Dec15 | Mar16 | Jun16 | Sep16 | Dec16 | Mar17 | Jun17 | Sep17 | Dec17 | Mar18 | Jun18 | Sep18 | Dec18 | |
ROIC % | Get a 7-Day Free Trial | 65.42 | -38.70 | -56.51 | 101.61 | -114.29 |
For the Biotechnology subindustry, OncoMed Pharmaceuticals'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 Biotechnology industry and Healthcare sector, OncoMed Pharmaceuticals's ROIC % distribution charts can be found below:
* The bar in red indicates where OncoMed Pharmaceuticals's ROIC % falls into.
OncoMed Pharmaceuticals's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2018 is calculated as:
ROIC % (A: Dec. 2018 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Dec. 2017 ) | + | Invested Capital (A: Dec. 2018 )) | / count ) |
= | -8.194 * ( 1 - 4.5% ) | / | ( (90.043 | + | 6.913) | / 2 ) |
= | -7.82527 | / | 48.478 | |||
= | -16.14 % |
where
Invested Capital | (A: Dec. 2017 ) | |||||||||||
= | 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 | )) |
= | 110.322 | - | 8.206 | - | ( 103.091 | - | max(0, 93.132 | - | 105.205 | + | 103.091 | )) |
= | 90.043 |
Invested Capital | (A: Dec. 2018 ) | |||||||||||
= | 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 | )) |
= | 65.078 | - | 7.082 | - | ( 57.345 | - | max(0, 12.644 | - | 63.727 | + | 57.345 | )) |
= | 6.913 |
OncoMed Pharmaceuticals's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2018 is calculated as:
ROIC % (Q: Dec. 2018 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Sep. 2018 ) | + | Invested Capital (Q: Dec. 2018 )) | / count ) |
= | -12.66 * ( 1 - -0.02% ) | / | ( (15.246 | + | 6.913) | / 2 ) |
= | -12.662532 | / | 11.0795 | |||
= | -114.29 % |
where
Invested Capital | (Q: Sep. 2018 ) | |||||||||||
= | 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 | )) |
= | 77.153 | - | 10.061 | - | ( 70.856 | - | max(0, 21.339 | - | 73.185 | + | 70.856 | )) |
= | 15.246 |
Invested Capital | (Q: Dec. 2018 ) | |||||||||||
= | 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 | )) |
= | 65.078 | - | 7.082 | - | ( 57.345 | - | max(0, 12.644 | - | 63.727 | + | 57.345 | )) |
= | 6.913 |
Note: The Operating Income data used here is four times the quarterly (Dec. 2018) 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.
OncoMed Pharmaceuticals (NAS:OMED) 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, OncoMed Pharmaceuticals's WACC % is 0.00%. OncoMed Pharmaceuticals's ROIC % is 0.00% (calculated using TTM income statement data).
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.
Thank you for viewing the detailed overview of OncoMed Pharmaceuticals's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Perry A Karsen | director | C/O CELGENE CORPORATION, 86 MORRIS AVENUE, SUMMIT NJ 07901 |
Deepika Pakianathan | director | 160 BOVET ROAD, SUITE 408, C/O DELPHI VENTURES, SAN MATEO CA 94402 |
Jack W Lasersohn | director | 18 BANK STREET, SUMMIT NJ 07901 |
Jonathan D Root | director | 2735 SAND HILL ROAD, MENLO PARK CA 94025 |
Michael S Wyzga | director | RADIUS HEALTH, INC., 201 BROADWAY, 6TH FLOOR, CAMBRIDGE MA 02139 |
Rick E Winningham | director | 901 GATEWAY BOULEVARD, SOUTH SAN FRANCISCO CA 94080 |
Denise Scots-knight | director | C/O IDENIX PHARMACEUTICALS, INC., 60 HAMPSHIRE STREET, CAMBRIDGE MA 02139 |
Sunil Patel | officer: See Remarks | 11085 NORTH TORREY PINES RD., SUITE 300, LA JOLLA CA 92037 |
Paul J Hastings | officer: Chairman & CEO | 61 HARTFORD STREET, SAN FRANCISCO CA 94114 |
Laurence Lasky | director | C/O COLUMN GROUP LP, 1700 OWENS STREET, SUITE 500, SAN FRANCISCO CA 94158 |
Jakob Dupont | officer: SVP & Chief Medical Officer | C/O ONCOMED PHARMACEUTICALS, INC., 800 CHESAPEAKE DRIVE, REDWOOD CITY CA 94063 |
Terry P Gould | director | C/O ONCOMED PHARMACEUTICALS, INC., 800 CHESAPEAKE DRIVE, REDWOOD CITY CA 94063 |
Usvp Entrepreneur Partners Viii A L P | 10 percent owner | P O BOX 7460, MENLO PARK CA 94026 |
Usvp Entrepreneur Partners Viii B L P | 10 percent owner | P O BOX 7460, MENLO PARK CA 94026 |
Usvp Viii Affiliates Fund L P | 10 percent owner | 2735 SAND HILL ROAD, MENLO PARK CA 94025 |
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