Alibaba Health Information Technology (Alibaba Health Information Technology) ROC % : 9.08% (As of Sep. 2023)

View and export this data going back to 2015. Start your Free Trial

What is Alibaba Health Information Technology 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 %. Alibaba Health Information Technology's annualized return on capital (ROC %) for the quarter that ended in Sep. 2023 was 9.08%.

As of today (2024-04-30), Alibaba Health Information Technology's WACC % is 18.50%. Alibaba Health Information Technology's ROC % is 5.02% (calculated using TTM income statement data). Alibaba Health Information Technology earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Alibaba Health Information Technology ROC % Historical Data

The historical data trend for Alibaba Health Information Technology'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.

* Premium members only.

Alibaba Health Information Technology ROC % Chart

Alibaba Health Information Technology Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

ROC %

Get a 7-Day Free Trial

-4.73

1.84

2.80

-21.73

0.76

Alibaba Health Information Technology Semi-Annual Data
	Mar14	Sep14	Mar15	Sep15	Mar16	Sep16	Mar17	Sep17	Mar18	Sep18	Mar19	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
ROC %	Get a 7-Day Free Trial															-24.52	-25.00	0.90	0.65	9.08

Alibaba Health Information Technology ROC % Calculation

Alibaba Health Information Technology's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2023 is calculated as:

	ROC % (A: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2022 )	+	Invested Capital (A: Mar. 2023 ))	/ count )
=	7.437 * ( 1 - 3.04% )	/	( (964.223	+	923.904)	/ 2 )
=	7.2109152	/	944.0635
=	0.76 %

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	))
=	3026.506	-	684.201	-	( 1662.493	-	max(0, 760.037	-	2138.119	+	1662.493	))
=	964.223

	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	))
=	3010.901	-	711.8	-	( 1584.288	-	max(0, 789.076	-	2164.273	+	1584.288	))
=	923.904

Alibaba Health Information Technology's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2023 is calculated as:

	ROC % (Q: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	87.64 * ( 1 - 7.51% )	/	( (923.904	+	862.417)	/ 2 )
=	81.058236	/	893.1605
=	9.08 %

where

	Invested Capital		(Q: 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	))
=	3010.901	-	711.8	-	( 1584.288	-	max(0, 789.076	-	2164.273	+	1584.288	))
=	923.904

	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	))
=	2937.789	-	640.449	-	( 1658.81	-	max(0, 713.896	-	2148.819	+	1658.81	))
=	862.417

Note: The Operating Income data used here is two times the semi-annual (Sep. 2023) data.

Alibaba Health Information Technology (OTCPK:ALBHF) 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, Alibaba Health Information Technology's WACC % is 18.50%. Alibaba Health Information Technology's ROC % is 5.02% (calculated using TTM income statement data). Alibaba Health Information Technology 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.

Alibaba Health Information Technology ROC % Related Terms

Thank you for viewing the detailed overview of Alibaba Health Information Technology's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.

Alibaba Health Information Technology (Alibaba Health Information Technology) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Healthcare Providers & Services » Alibaba Health Information Technology Ltd (OTCPK:ALBHF) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

ALBBY:USA 00241:Hong Kong TWYA:Germany TWY:Germany TWY:Germany

Address

Guanghua Road, 65/F, CITIC Tower, Building 1, No.10, Jianwai Subdistrict, Chaoyang District, Beijing, CHN

Website

https://www.alihealth.cn

Alibaba Health is of one of China's leading e-commerce platform specializing in healthcare-related products, including prescription drugs, OTC drugs, traditional Chinese medicine, health foods, and so on. The company operates both a third-party B2C service, or 3P, and its own direct-to-consumer business, or 1P, with its own inventory, which can both be accessed by Alibaba's Tmall app and Alipay. The company also provides online consultation services in a separate app called Yilu or "Dr. Deer", although its e-commerce businesses remain its core competency in the long-term. E-commerce accounted for 97% of revenue in fiscal year 2022. We estimate that AliHealth holds about 45% of market share in the industry in terms of GMV. AliHealth is 63.74% owned by its parent company, Alibaba Group.