Belite Bio (Belite Bio) ROC % : -62.30% (As of Mar. 2024)

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What is Belite Bio 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 %. Belite Bio's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -62.30%.

As of today (2024-06-24), Belite Bio's WACC % is 10.25%. Belite Bio's ROC % is -62.46% (calculated using TTM income statement data). Belite Bio earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Belite Bio ROC % Historical Data

The historical data trend for Belite Bio'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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Belite Bio ROC % Chart

Belite Bio Annual Data

Trend

Dec20

Dec21

Dec22

Dec23

ROC %

-7,364.29

-1,709.77

-804.33

-791.34

Belite Bio Quarterly Data
	Dec20	Jun21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial							-131.38	-54.71	-74.14	-87.64	-62.30

Belite Bio ROC % Calculation

Belite Bio's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-31.668 * ( 1 - -0.03% )	/	( (2.12	+	5.886)	/ 2 )
=	-31.6775004	/	4.003
=	-791.34 %

where

	Invested Capital		(A: Dec. 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	))
=	44.273	-	1.45	-	( 42.089	-	max(0, 2.104	-	42.807	+	42.089	))
=	2.12

	Invested Capital		(A: 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	))
=	94.642	-	2.449	-	( 88.157	-	max(0, 3.633	-	89.94	+	88.157	))
=	5.886

Belite Bio's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	-33.312 * ( 1 - -0.08% )	/	( (5.886	+	101.147)	/ 2 )
=	-33.3386496	/	53.5165
=	-62.30 %

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	))
=	94.642	-	2.449	-	( 88.157	-	max(0, 3.633	-	89.94	+	88.157	))
=	5.886

	Invested Capital		(Q: Mar. 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	))
=	101.147	-	0	-	( 0	-	max(0, 0	-	96.468	+	0	))
=	101.147

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

Belite Bio (NAS:BLTE) 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, Belite Bio's WACC % is 10.25%. Belite Bio's ROC % is -62.46% (calculated using TTM income statement data). Belite Bio 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.

Belite Bio ROC % Related Terms

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Belite Bio (Belite Bio) Business Description

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D01:Germany

Address

12750 High Bluff Drive, Suite 475, San Diego, CA, USA, 92130

Website

https://www.belitebio.com

Belite Bio Inc is a clinical-stage biopharmaceutical drug development company focused on novel therapeutics targeting untreatable eye diseases involving retinal degeneration such as atrophic age-related macular degeneration and autosomal recessive Stargardt disease or STGD1, both of which progressively lead to permanent blindness, and metabolic diseases such as non-alcoholic fatty liver disease, or NAFLD, nonalcoholic steatohepatitis, or NASH, type 2 diabetes, or T2D, and gout.