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Boston Scientific ROIC %

: 5.39% (As of Jun. 2022)
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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 %. Boston Scientific's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2022 was 5.39%.

As of today (2022-08-12), Boston Scientific's WACC % is 6.97%. Boston Scientific's ROIC % is 5.63% (calculated using TTM income statement data). Boston Scientific earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Boston Scientific ROIC % Historical Data

The historical data trend for Boston Scientific'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.

* Premium members only.

Boston Scientific Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
ROIC %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.96 9.92 49.05 2.55 6.55

Boston Scientific Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 9.98 6.03 5.52 4.90 5.39

Competitive Comparison

For the Medical Devices subindustry, Boston Scientific'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.

   

Boston Scientific ROIC % Distribution

For the Medical Devices & Instruments industry and Healthcare sector, Boston Scientific's ROIC % distribution charts can be found below:

* The bar in red indicates where Boston Scientific's ROIC % falls into.



Boston Scientific ROIC % Calculation

Boston Scientific'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 )
=1824 * ( 1 - 3.35% )/( (26678 + 27128)/ 2 )
=1762.896/26903
=6.55 %

where

Boston Scientific's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Jun. 2022 is calculated as:

ROIC % (Q: Jun. 2022 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2022 ) + Invested Capital (Q: Jun. 2022 ))/ count )
=2072 * ( 1 - 24.64% )/( (28829 + 29087)/ 2 )
=1561.4592/28958
=5.39 %

where

Note: The Operating Income data used here is four times the quarterly (Jun. 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.


Boston Scientific  (NYSE:BSX) 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, Boston Scientific's WACC % is 6.97%. Boston Scientific's ROIC % is 5.63% (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.


Boston Scientific ROIC % Related Terms

Thank you for viewing the detailed overview of Boston Scientific's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.


Boston Scientific Business Description

Boston Scientific logo
Address
300 Boston Scientific Way, Marlborough, MA, USA, 01752-1234
Boston Scientific produces less invasive medical devices that are inserted into the human body through small openings or cuts. It manufactures products for use in angioplasty, blood clot filtration, cardiac rhythm management, catheter-directed ultrasound imaging, structural heart disease, upper gastrointestinal tract diagnostics, interventional oncology, and treatment of incontinence. The firm markets its devices to healthcare professionals and institutions globally. Foreign sales account for nearly half of the firm's total sales.
Executives
Wichmann David S director UNITEDHEALTH GROUP INC 9900 BREN RD E MINNETONKA MN 55343
Brown Vance R officer: SVP, GC and Corp. Secretary C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Olson Scott officer: SVP & Pres, Rhythm Management C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Scanlon Meghan officer: SVP,Pres,Urology Pelvic Health C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Monson Jonathan officer: VP, Corp Controller and CAO C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Fujimori Yoshiaki director 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
James Donna director ONE MIRANOVA PLACE SUITE 1040 COLUMBUS OH 43215
Zane Ellen M director C/O TUFTS-NEW ENGLAND MEDICAL CENTER 750 WASHINGTON STREET, TUFTS-NEMC #451 BOSTON MA 02111
Sununu John E director C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Connors Nelda J director BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752-1234
Ludwig Edward J director C/O BECTON DICKERSON & CO 1 BECTON DR FRANKLIN LAKES NJ 07417
Roux David J director C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752
Dockendorff Charles J director COVIDIEN LTD. 15 HAMPSHIRE STREET MANSFIELD MA 02048
Macmillan Stephen P director 250 CAMPUS DRIVE MARLBOROUGH MA 01752
Wang Xin Warren officer: SVP and Pres, Asia Pacific C/O BOSTON SCIENTIFIC CORPORATION 300 BOSTON SCIENTIFIC WAY MARLBOROUGH MA 01752

Boston Scientific Headlines

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