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Baby Bunting Group (ASX:BBN) ROC % : -8.99% (As of Jun. 2024)


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What is Baby Bunting Group 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 %. Baby Bunting Group's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was -8.99%.

As of today (2024-12-12), Baby Bunting Group's WACC % is 6.44%. Baby Bunting Group's ROC % is -5.00% (calculated using TTM income statement data). Baby Bunting Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Baby Bunting Group ROC % Historical Data

The historical data trend for Baby Bunting Group'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.

Baby Bunting Group ROC % Chart

Baby Bunting Group Annual Data
Trend Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22 Jun23 Jun24
ROC %
Get a 7-Day Free Trial Premium Member Only 2.25 1.72 2.28 -1.73 -5.03

Baby Bunting Group Semi-Annual Data
Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
ROC % Get a 7-Day Free Trial 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 4.74 -3.43 0.45 -4.61 -8.99

Baby Bunting Group ROC % Calculation

Baby Bunting Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2024 is calculated as:

ROC % (A: Jun. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Jun. 2023 ) + Invested Capital (A: Jun. 2024 ))/ count )
=-24.164 * ( 1 - 40.32% )/( (293.52 + 279.773)/ 2 )
=-14.4210752/286.6465
=-5.03 %

where

Invested Capital(A: Jun. 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))
=343.888 - 45.371 - ( 4.997 - max(0, 92.379 - 110.958+4.997))
=293.52

Invested Capital(A: Jun. 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))
=332.365 - 43.067 - ( 9.525 - max(0, 91.226 - 111.642+9.525))
=279.773

Baby Bunting Group's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:

ROC % (Q: Jun. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Dec. 2023 ) + Invested Capital (Q: Jun. 2024 ))/ count )
=-28.508 * ( 1 - 9.73% )/( (292.545 + 279.773)/ 2 )
=-25.7341716/286.159
=-8.99 %

where

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))
=350.855 - 51.539 - ( 6.771 - max(0, 101.793 - 113.207+6.771))
=292.545

Invested Capital(Q: Jun. 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))
=332.365 - 43.067 - ( 9.525 - max(0, 91.226 - 111.642+9.525))
=279.773

Note: The Operating Income data used here is two times the semi-annual (Jun. 2024) 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.

Baby Bunting Group  (ASX:BBN) 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, Baby Bunting Group's WACC % is 6.44%. Baby Bunting Group's ROC % is -5.00% (calculated using TTM income statement data). Baby Bunting Group 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.

Baby Bunting Group ROC % Related Terms

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Baby Bunting Group Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Baby Bunting Group Ltd (ASX:BBN) » Definitions » ROC %
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Traded in Other Exchanges
N/A
Address
153 National Drive, Dandenong South, Melbourne, VIC, AUS, 3175
Website
https://www.babybunting.com.au
Baby Bunting Group Ltd operates as a nursery retailer in Australia. The company product categories include prams, cots and nursery furniture, car safety, toys, babywear, feeding, nappies, manchester, and associated accessories. The company also has operations in New Zealand, with a store in Auckland and an online store. Geographically, it derives revenue from Australia and New Zealand.