Wowjoint Holdings (Wowjoint Holdings) ROC % : 0.00% (As of Dec. 2013)

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What is Wowjoint 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 %. Wowjoint Holdings's annualized return on capital (ROC %) for the quarter that ended in Dec. 2013 was 0.00%.

As of today (2024-06-24), Wowjoint Holdings's WACC % is 0.00%. Wowjoint Holdings's ROC % is 0.00% (calculated using TTM income statement data). Wowjoint Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Wowjoint Holdings ROC % Historical Data

The historical data trend for Wowjoint 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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Wowjoint Holdings ROC % Chart

Wowjoint Holdings Annual Data

Trend

Dec08

Dec10

Dec11

Dec12

Dec13

ROC %

-0.98

1.26

-0.02

-19.63

-4.96

Wowjoint Holdings Quarterly Data
	May08	Dec08	Jun09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Dec12	Jun13	Dec13
ROC %	Get a 7-Day Free Trial											-15.03	-11.88	-	-	-

Wowjoint Holdings ROC % Calculation

Wowjoint Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2013 is calculated as:

	ROC % (A: Dec. 2013 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2012 )	+	Invested Capital (A: Dec. 2013 ))	/ count )
=	-1.21 * ( 1 - -8.73% )	/	( (21.752	+	31.337)	/ 2 )
=	-1.315633	/	26.5445
=	-4.96 %

where

	Invested Capital		(A: Dec. 2012 )
=	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	))
=	38.305	-	15.245	-	( 1.714	-	max(0, 20.469	-	21.777	+	1.714	))
=	21.752

	Invested Capital		(A: Dec. 2013 )
=	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	))
=	48.837	-	21.475	-	( 1.566	-	max(0, 30.727	-	26.752	+	1.566	))
=	31.337

Wowjoint Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2013 is calculated as:

	ROC % (Q: Dec. 2013 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2013 )	+	Invested Capital (Q: Dec. 2013 ))	/ count )
=	0 * ( 1 - 0% )	/	( (31.452	+	31.337)	/ 2 )
=	0	/	31.3945
=	0.00 %

where

	Invested Capital		(Q: Jun. 2013 )
=	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	))
=	48.024	-	18.137	-	( 2.266	-	max(0, 29.3	-	27.735	+	2.266	))
=	31.452

	Invested Capital		(Q: Dec. 2013 )
=	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	))
=	48.837	-	21.475	-	( 1.566	-	max(0, 30.727	-	26.752	+	1.566	))
=	31.337

Note: The Operating Income data used here is four times the quarterly (Dec. 2013) data.

Wowjoint Holdings (OTCPK:BWOWF) 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, Wowjoint Holdings's WACC % is 0.00%. Wowjoint Holdings's ROC % is 0.00% (calculated using TTM income statement data). Wowjoint 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.

Wowjoint Holdings ROC % Related Terms

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Wowjoint Holdings (Wowjoint Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Farm & Heavy Construction Machinery » Wowjoint Holdings Ltd (OTCPK:BWOWF) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

No. 2 Xinfeng Road, Deshemengwai Street, 1108 A Block Tiancheng Mansion, Xicheng District, Beijing, CHN, 100088

Website

http://www.wowjoint.com

Wowjoint Holdings Ltd provides infrastructure solutions for customized heavy duty lifting and carrying machinery used in large-scale projects. The company operates under the manufacture and marketing of non-standard heavy lifting and carrying equipment in China. The equipment and machinery are used in various engineering fields, such as bridge, road and railway construction, as well as in areas of heavy capacity lifting and transporting of concrete beams, boats, and shipping containers. Geographically all the operations are functioned through the region of China.

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