Generative AI Solutions (Generative AI Solutions) ROC % : -42.25% (As of Jan. 2024)

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What is Generative AI Solutions 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 %. Generative AI Solutions's annualized return on capital (ROC %) for the quarter that ended in Jan. 2024 was -42.25%.

As of today (2024-06-22), Generative AI Solutions's WACC % is 28.32%. Generative AI Solutions's ROC % is -23.76% (calculated using TTM income statement data). Generative AI Solutions earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Generative AI Solutions ROC % Historical Data

The historical data trend for Generative AI Solutions'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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Generative AI Solutions ROC % Chart

Generative AI Solutions Annual Data

Trend

Feb22

Jan23

Jan24

ROC %

-1.71

-184.69

Generative AI Solutions Quarterly Data
	May20	Aug20	Nov20	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	Jul23	Oct23	Jan24
ROC %	Get a 7-Day Free Trial									-	-	-21.33	-14.68	-42.25

Generative AI Solutions ROC % Calculation

Generative AI Solutions's annualized Return on Capital (ROC %) for the fiscal year that ended in Jan. 2024 is calculated as:

	ROC % (A: Jan. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jan. 2023 )	+	Invested Capital (A: Jan. 2024 ))	/ count )
=	-2.353 * ( 1 - 0% )	/	( (0.24	+	2.308)	/ 2 )
=	-2.353	/	1.274
=	-184.69 %

where

	Invested Capital		(A: Jan. 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	))
=	0.705	-	0.133	-	( 0.332	-	max(0, 0.133	-	0.593	+	0.332	))
=	0.24

	Invested Capital		(A: Jan. 2024 )
=	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	))
=	3.622	-	0.08	-	( 1.234	-	max(0, 0.673	-	2.037	+	1.234	))
=	2.308

Generative AI Solutions's annualized Return on Capital (ROC %) for the quarter that ended in Jan. 2024 is calculated as:

	ROC % (Q: Jan. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Oct. 2023 )	+	Invested Capital (Q: Jan. 2024 ))	/ count )
=	-3.032 * ( 1 - 0% )	/	( (12.046	+	2.308)	/ 2 )
=	-3.032	/	7.177
=	-42.25 %

where

	Invested Capital		(Q: Oct. 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	))
=	13.786	-	0.163	-	( 1.577	-	max(0, 0.619	-	2.282	+	1.577	))
=	12.046

	Invested Capital		(Q: Jan. 2024 )
=	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	))
=	3.622	-	0.08	-	( 1.234	-	max(0, 0.673	-	2.037	+	1.234	))
=	2.308

Note: The Operating Income data used here is four times the quarterly (Jan. 2024) data.

Generative AI Solutions (OTCPK:AICOF) 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, Generative AI Solutions's WACC % is 28.32%. Generative AI Solutions's ROC % is -23.76% (calculated using TTM income statement data). Generative AI Solutions 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.

Generative AI Solutions ROC % Related Terms

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Generative AI Solutions (Generative AI Solutions) Business Description

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N8T:Germany AICO:Canada

Address

550 Burrard Street, Suite 2300, Bentall 5, Vancouver, BC, CAN, V6C 2B5

Website

https://www.genai-solutions.com

Generative AI Solutions Corp is an artificial intelligence company, focused on developing transformative AI-powered tools for businesses and consumers across multiple industries. The group develops state-of-the-art AI-based solutions that have broad applicability and can be seamlessly integrated into diverse workflows. The company leverages its expertise in machine learning, natural language processing, and data analytics, GenAI seeks to build versatile, high-performance tools that redefine efficiency, productivity, and user experience.