Market Cap : 20.9 B | Enterprise Value : 18.87 B | PE Ratio : 35.06 | PB Ratio : 3.80 |
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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 %. Take-Two Interactive Software's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2022 was 12.06%.
As of today (2022-08-09), Take-Two Interactive Software's WACC % is 4.36%. Take-Two Interactive Software's ROIC % is 12.01% (calculated using TTM income statement data). Take-Two Interactive Software 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.
The historical data trend for Take-Two Interactive Software'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 Electronic Gaming & Multimedia subindustry, Take-Two Interactive Software'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 Interactive Media industry and Communication Services sector, Take-Two Interactive Software's ROIC % distribution charts can be found below:
* The bar in red indicates where Take-Two Interactive Software's ROIC % falls into.
Take-Two Interactive Software's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2022 is calculated as:
ROIC % (A: Mar. 2022 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Mar. 2021 ) | + | Invested Capital (A: Mar. 2022 )) | / count ) |
= | 474.444 * ( 1 - 10.18% ) | / | ( (2986.137 | + | 3875.019) | / 2 ) |
= | 426.1456008 | / | 3430.578 | |||
= | 12.42 % |
where
Invested Capital | (A: Mar. 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 | )) |
= | 6028.218 | - | 1056.281 | - | ( 2731.576 | - | max(0, 2234.715 | - | 4220.515 | + | 2731.576 | )) |
= | 2986.137 |
Invested Capital | (A: 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 | )) |
= | 6546.219 | - | 905.076 | - | ( 2552.107 | - | max(0, 2104.964 | - | 3871.088 | + | 2552.107 | )) |
= | 3875.019 |
Take-Two Interactive Software'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 ) |
= | 516.668 * ( 1 - 8.92% ) | / | ( (3929.341 | + | 3875.019) | / 2 ) |
= | 470.5812144 | / | 3902.18 | |||
= | 12.06 % |
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 | )) |
= | 6357.953 | - | 795.944 | - | ( 2465.754 | - | max(0, 2072.345 | - | 3705.013 | + | 2465.754 | )) |
= | 3929.341 |
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 | )) |
= | 6546.219 | - | 905.076 | - | ( 2552.107 | - | max(0, 2104.964 | - | 3871.088 | + | 2552.107 | )) |
= | 3875.019 |
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, Take-Two Interactive Software's WACC % is 4.36%. Take-Two Interactive Software's ROIC % is 12.01% (calculated using TTM income statement data). Take-Two Interactive Software 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. Take-Two Interactive Software earns returns that do not match up to its cost of capital. It will destroy value as it grows.
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 Take-Two Interactive Software's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Gordon William B | director | |
Siminoff Ellen F | director | 555 ELLIS STREET MOUNTAIN VIEW CA 94043 |
Hernandez Roland A | director | 300 NORTH SAN RAFAEL AVE PASADENA CA 91105 |
Viera Paul E | director | C/O TAKE-TWO INTERACTIVE SOFTWARE, INC. 110 WEST 44TH STREET NEW YORK NY 10036 |
Srinivasan Laverne Evans | director | C/O TAKE-TWO INTERACTIVE SOFTWARE, INC. 622 BROADWAY NEW YORK NY 10012 |
Emerson Daniel P | officer: General Counsel | 622 BROADWAY NEW YORK NY 10012 |
Tolson Susan | director | C/O TAKE-TWO INTERACTIVE SOFTWARE, INC. 622 BROADWAY NEW YORK NY 10019 |
Feder Benjamim | officer: Chief Executive Officer | C/O ZELNICKMEDIA CORPORATION 650 5TH AVENUE NEW YORK NY 10019 |
Slatoff Karl | officer: Executive Vice President | C/O ZELNICKMEDIA CORPORATION 19 WEST 44TH STREET, 18TH FLOOR NEW YORK NY 10036 |
Icahn Brett | director | C/O ICAHN ENTERPRISES L.P. 16690 COLLINS AVE., PH SUNNY ISLES FL 33160 |
Nelson James Larry | director | 2747 PARADISE ROAD PH2804 LAS VEGAS NV 89109 |
Cho Sunghwan | director | C/O ICAHN ENTERPRISES L.P. 16690 COLLINS AVE., PH SUNNY ISLES FL 33160 |
Zelnick Strauss | director, officer: Executive Chairman | C/O ZELNICKMEDIA 650 FIFTH AVE 31ST FLOOR NEW YORK NY 10019 |
Goldstein Lainie | officer: Chief Financial Officer | C/O TAKE-TWO INTERACTIVE SOFTWARE, INC. 622 BROADWAY NEW YORK NY 10012 |
Krauss Seth D | officer: Exec VP and General Counsel | C/O TAKE-TWO INTERACTIVE SOFTWARE, INC. 222 BROADWAY NEW YORK NY 10012 |
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