American Community Newspapers (American Community Newspapers) ROC % : 2.47% (As of Jun. 2008)

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What is American Community Newspapers ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. American Community Newspapers's annualized return on capital (ROC %) for the quarter that ended in Jun. 2008 was 2.47%.

As of today (2024-06-24), American Community Newspapers's WACC % is 0.00%. American Community Newspapers's ROC % is 0.00% (calculated using TTM income statement data). American Community Newspapers earns returns that do not match up to its cost of capital. It will destroy value as it grows.

American Community Newspapers ROC % Historical Data

The historical data trend for American Community Newspapers's ROC % 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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American Community Newspapers ROC % Chart

American Community Newspapers Annual Data

Trend

Dec05

Dec06

Dec07

ROC %

0.55

-0.54

0.80

American Community Newspapers Quarterly Data
	Jun05	Sep05	Dec05	Mar06	Jun06	Sep06	Dec06	Mar07	Jun07	Sep07	Dec07	Mar08	Jun08
ROC %	Get a 7-Day Free Trial								-0.68	2.76	0.70	-0.87	2.47

American Community Newspapers ROC % Calculation

American Community Newspapers's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2007 is calculated as:

	ROC % (A: Dec. 2007 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2006 )	+	Invested Capital (A: Dec. 2007 ))	/ count )
=	1.216 * ( 1 - 6.33% )	/	( (76.883	+	208.06)	/ 2 )
=	1.1390272	/	142.4715
=	0.80 %

where

	Invested Capital		(A: Dec. 2006 )
=	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	))
=	78.354	-	0.278	-	( 1.193	-	max(0, 1.181	-	78.267	+	1.193	))
=	76.883

	Invested Capital		(A: Dec. 2007 )
=	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	))
=	214.548	-	5.65	-	( 1.521	-	max(0, 9.065	-	9.903	+	1.521	))
=	208.06

American Community Newspapers's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2008 is calculated as:

	ROC % (Q: Jun. 2008 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2008 )	+	Invested Capital (Q: Jun. 2008 ))	/ count )
=	5.556 * ( 1 - 2.08% )	/	( (205.998	+	234.005)	/ 2 )
=	5.4404352	/	220.0015
=	2.47 %

where

	Invested Capital		(Q: Mar. 2008 )
=	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	))
=	210.946	-	5.699	-	( 0.631	-	max(0, 10.185	-	9.434	+	0.631	))
=	205.998

	Invested Capital		(Q: Jun. 2008 )
=	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	))
=	100.802	-	4.792	-	( 2.552	-	max(0, 149.412	-	11.417	+	2.552	))
=	234.005

Note: The Operating Income data used here is four times the quarterly (Jun. 2008) data.

American Community Newspapers (OTCPK:ACNI) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 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 ROC % 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, American Community Newspapers's WACC % is 0.00%. American Community Newspapers's ROC % is 0.00% (calculated using TTM income statement data). American Community Newspapers 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 %, ROC % 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.

American Community Newspapers ROC % Related Terms

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American Community Newspapers (American Community Newspapers) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » American Community Newspapers Inc (OTCPK:ACNI) » Definitions » ROC %

Comparable Companies

FRLF GLBD EDUC MNI AHC LEE VALU DJCO IDWM TRNC NEWM GCI TIME SCHL MDP NYT JW.B

Traded in Other Exchanges

N/A

Address

14875 Landmark Boulevard, Suite 110, Addison, TX, USA, 75254

Website

http://www.acnpapers.com

American Community Newspapers Inc is a community newspaper publisher in the United States, operating within four major U.S. markets.

Executives

Rachesky Mark H Md	10 percent owner	40 WEST 57TH STREET, 24TH FLOOR, NEW YORK NY 10019
Mhr Fund Management Llc	10 percent owner	1345 AVENUE OF THE AMERICAS,, 42ND FLOOR, NEW YORK NY 10105
Mhr Advisors Llc	10 percent owner
Marilyn Rubenstein	10 percent owner
Woodland Services Corp	10 percent owner
Israel A Englander	other: May be deemed as group member.	C/O MILLENNIUM MANAGEMENT LLC, 399 PARK AVENUE, NEW YORK NY 10022
Millenco, L.l.c.	10 percent owner	C/O MILLENNIUM MANAGEMENT LLC, 666 FIFTH AVENUE, 8TH FLOOR, NEW YORK NY 10103
Millennium Management Llc	other: May be deemed as group member.	399 PARK AVENUE, NEW YORK NY 10022
Barry Rubenstein	10 percent owner	68 WHEATLEY RD, BROOKVILLE NY 11545

American Community Newspapers (American Community Newspapers) Headlines

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