Banxa Holdings (Banxa Holdings) ROC % : -7.90% (As of Dec. 2023)

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What is Banxa Holdings 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 %. Banxa Holdings's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -7.90%.

As of today (2024-05-01), Banxa Holdings's WACC % is 19.89%. Banxa Holdings's ROC % is -26.65% (calculated using TTM income statement data). Banxa Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Banxa Holdings ROC % Historical Data

The historical data trend for Banxa Holdings'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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Banxa Holdings ROC % Chart

Banxa Holdings Annual Data

Trend

Jun20

Jun21

Jun22

Jun23

ROC %

-132.16

116.12

-465.33

-104.80

Banxa Holdings Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial												-102.39	62.74	-133.67	-14.22	-7.90

Banxa Holdings ROC % Calculation

Banxa Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2023 is calculated as:

	ROC % (A: Jun. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2022 )	+	Invested Capital (A: Jun. 2023 ))	/ count )
=	-5.997 * ( 1 - 3.25% )	/	( (2.111	+	8.962)	/ 2 )
=	-5.8020975	/	5.5365
=	-104.80 %

where

	Invested Capital		(A: Jun. 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	))
=	10.819	-	4.199	-	( 6.58	-	max(0, 4.963	-	9.472	+	6.58	))
=	2.111

	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	))
=	11.09	-	5.668	-	( 5.543	-	max(0, 12.238	-	8.698	+	5.543	))
=	8.962

Banxa Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-0.68 * ( 1 - -3.45% )	/	( (9.614	+	8.202)	/ 2 )
=	-0.70346	/	8.908
=	-7.90 %

where

	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	))
=	9.236	-	4.301	-	( 1.138	-	max(0, 11.652	-	6.973	+	1.138	))
=	9.614

	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	))
=	11.195	-	4.454	-	( 1.045	-	max(0, 10.431	-	8.97	+	1.045	))
=	8.202

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Banxa Holdings (OTCPK:BNXAF) 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, Banxa Holdings's WACC % is 19.89%. Banxa Holdings's ROC % is -26.65% (calculated using TTM income statement data). Banxa Holdings 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.

Banxa Holdings ROC % Related Terms

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Banxa Holdings (Banxa Holdings) Business Description

Industry

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Comparable Companies

Traded in Other Exchanges

AC00:Germany BNXA:Canada

Address

2-6 Gwynne Street, Level 2, Melbourne, VIC, AUS, 3121

Website

https://www.banxa.com

Banxa Holdings Inc is a payments service provider for the digital asset space. It offers a cryptocurrency gateway platform to other businesses in the industry. The company's goal is to onboard the general public to digital currency by building a fully compliant payment infrastructure that enables simple and secure conversion of fiat currency to digital currency. Geographically, it operates in Australia, North America and Europe and derives a majority of its revenue from Europe.