ADM Tronics Unlimited (ADM Tronics Unlimited) ROIC % : -26.04% (As of Dec. 2023)

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What is ADM Tronics Unlimited ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. ADM Tronics Unlimited's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was -26.04%.

As of today (2024-04-26), ADM Tronics Unlimited's WACC % is 4.12%. ADM Tronics Unlimited's ROIC % is -41.66% (calculated using TTM income statement data). ADM Tronics Unlimited earns returns that do not match up to its cost of capital. It will destroy value as it grows.

ADM Tronics Unlimited ROIC % Historical Data

The historical data trend for ADM Tronics Unlimited'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.

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ADM Tronics Unlimited ROIC % Chart

ADM Tronics Unlimited Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

ROIC %

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-15.28

-5.84

-19.62

-133.74

-6.21

ADM Tronics Unlimited Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROIC %	Get a 7-Day Free Trial															20.32	-55.65	-30.25	-51.97	-26.04

Competitive Comparison of ADM Tronics Unlimited's ROIC %

For the Medical Devices subindustry, ADM Tronics Unlimited'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.

ADM Tronics Unlimited's ROIC % Distribution in the Medical Devices & Instruments Industry

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

* The bar in red indicates where ADM Tronics Unlimited's ROIC % falls into.

ADM Tronics Unlimited ROIC % Calculation

ADM Tronics Unlimited's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2023 is calculated as:

	ROIC % (A: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2022 )	+	Invested Capital (A: Mar. 2023 ))	/ count )
=	0.03 * ( 1 - 504.17% )	/	( (2.097	+	1.806)	/ 2 )
=	-0.121251	/	1.9515
=	-6.21 %

where

	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	))
=	3.35	-	0.513	-	( 1.137	-	max(0, 1.473	-	2.213	+	1.137	))
=	2.097

	Invested Capital		(A: Mar. 2023 )
=	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	))
=	3.09	-	0.412	-	( 1.004	-	max(0, 1.114	-	1.986	+	1.004	))
=	1.806

ADM Tronics Unlimited's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROIC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-0.42 * ( 1 - 0% )	/	( (1.667	+	1.559)	/ 2 )
=	-0.42	/	1.613
=	-26.04 %

where

	Invested Capital		(Q: Sep. 2023 )
=	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	))
=	2.742	-	0.359	-	( 0.716	-	max(0, 1.169	-	2.011	+	0.716	))
=	1.667

	Invested Capital		(Q: Dec. 2023 )
=	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	))
=	2.615	-	0.394	-	( 0.662	-	max(0, 1.168	-	1.938	+	0.662	))
=	1.559

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

ADM Tronics Unlimited (OTCPK:ADMT) 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, ADM Tronics Unlimited's WACC % is 4.12%. ADM Tronics Unlimited's ROIC % is -41.66% (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.

ADM Tronics Unlimited ROIC % Related Terms

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ADM Tronics Unlimited (ADM Tronics Unlimited) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » ADM Tronics Unlimited Inc (OTCPK:ADMT) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

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Address

224 Pegasus Avenue, Northvale, NJ, USA, 07647

Website

https://www.admtronics.com

ADM Tronics Unlimited Inc is a diversified, technology-based developer and manufacturer of technologies and products in the United States. The company's operating segment includes Chemical; Electronics and Engineering. It generates maximum revenue from the Electronics segment. The Electronics segment develops and manufactures electronic technologies for non-invasive, electrotherapeutic and diagnostic medical devices as well as for veterinary and other applications. It derives revenue from the production and sale of electronics for medical devices and other applications; environmentally safe chemical products for industrial, medical and cosmetic uses; research, development, regulatory, and engineering services.