BWACU (Better World Acquisition) ROC % : -8.30% (As of Mar. 2023)

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What is Better World Acquisition 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 %. Better World Acquisition's annualized return on capital (ROC %) for the quarter that ended in Mar. 2023 was -8.30%.

As of today (2024-12-11), Better World Acquisition's WACC % is 9.95%. Better World Acquisition's ROC % is -3.38% (calculated using TTM income statement data). Better World Acquisition earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Better World Acquisition ROC % Historical Data

The historical data trend for Better World Acquisition'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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Better World Acquisition ROC % Chart

Better World Acquisition Annual Data

Trend

Dec20

Dec21

Dec22

ROC %

-1.70

-2.49

Better World Acquisition Quarterly Data
	Jul20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23
ROC %	Get a 7-Day Free Trial						-1.56	-1.67	-2.63	-11.27	-8.30

Better World Acquisition ROC % Calculation

Better World Acquisition's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2022 is calculated as:

	ROC % (A: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2021 )	+	Invested Capital (A: Dec. 2022 ))	/ count )
=	-2.238 * ( 1 - 2.23% )	/	( (128.79	+	47.253)	/ 2 )
=	-2.1880926	/	88.0215
=	-2.49 %

where

	Invested Capital		(A: Dec. 2021 )
=	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	))
=	129.099	-	0.431	-	( 0.278	-	max(0, 0.431	-	0.309	+	0.278	))
=	128.79

	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	))
=	44.743	-	0.777	-	( 0.002	-	max(0, 3.333	-	0.046	+	0.002	))
=	47.253

Better World Acquisition's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2023 is calculated as:

	ROC % (Q: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2022 )	+	Invested Capital (Q: Mar. 2023 ))	/ count )
=	-3.108 * ( 1 - -9.76% )	/	( (47.253	+	34.961)	/ 2 )
=	-3.4113408	/	41.107
=	-8.30 %

where

	Invested Capital		(Q: 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	))
=	44.743	-	0.777	-	( 0.002	-	max(0, 3.333	-	0.046	+	0.002	))
=	47.253

	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	))
=	32.464	-	1.866	-	( 0.141	-	max(0, 4.602	-	0.239	+	0.141	))
=	34.961

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

Better World Acquisition (OTCPK:BWACU) 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, Better World Acquisition's WACC % is 9.95%. Better World Acquisition's ROC % is -3.38% (calculated using TTM income statement data). Better World Acquisition 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.

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Better World Acquisition Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Diversified Financial Services » Better World Acquisition Corp (OTCPK:BWACU) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

775 Park Avenue, New York, NY, USA, 10021

Website

Better World Acquisition Corp is a blank check company.

Executives

Robert M Chiste	director	120 EAGLE ROCK AVENUE SUITE 190, EAST HANOVER NJ 07936
Bradford Scovill Oberwager	director	340 S. LEMON AVE. #5445, WALNUT CA 91789
Grubstein Peter S H	director, 10 percent owner, officer: Chief Financial Officer
Kristopher A Wood	director	11360 LAKE FIELD DRIVE, DULUTH GA 30097
Bwa Holdings Llc	10 percent owner	1177 AVENUE OF THE AMERICAS 18TH FLOOR, NEW YORK NY 10036
Rosemary L Ripley	director, officer: Chief Executive Officer	733 THIRD AVENUE, NEW YORK NY 10017
Shay Murphy	officer: Vice President	733 THIRD AVENUE, NEW YORK NY 10017
Jennifer Prosek	director	733 THIRD AVENUE, NEW YORK NY 10017