Twist Bioscience (FRA:0ME) ROC % : -50.58% (As of Mar. 2024)

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What is Twist Bioscience 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 %. Twist Bioscience's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -50.58%.

As of today (2024-05-17), Twist Bioscience's WACC % is 17.90%. Twist Bioscience's ROC % is -46.79% (calculated using TTM income statement data). Twist Bioscience earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Twist Bioscience ROC % Historical Data

The historical data trend for Twist Bioscience'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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Twist Bioscience ROC % Chart

Twist Bioscience Annual Data

Trend

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

ROC %

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-317.18

-181.76

-105.94

-80.40

-48.04

Twist Bioscience Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial															-57.89	-45.46	-44.78	-46.24	-50.58

Twist Bioscience ROC % Calculation

Twist Bioscience's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2023 is calculated as:

	ROC % (A: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2022 )	+	Invested Capital (A: Sep. 2023 ))	/ count )
=	-193.868 * ( 1 - -0.57% )	/	( (426.713	+	384.929)	/ 2 )
=	-194.9730476	/	405.821
=	-48.04 %

where

	Invested Capital		(A: Sep. 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	))
=	970.992	-	34.261	-	( 510.018	-	max(0, 91.57	-	602.448	+	510.018	))
=	426.713

	Invested Capital		(A: 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	))
=	727.49	-	27.342	-	( 315.219	-	max(0, 68.704	-	397.528	+	315.219	))
=	384.929

Twist Bioscience'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 )
=	-179.912 * ( 1 - -0.76% )	/	( (362.452	+	354.368)	/ 2 )
=	-181.2793312	/	358.41
=	-50.58 %

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	))
=	671.991	-	24.22	-	( 285.319	-	max(0, 59.814	-	357.842	+	285.319	))
=	362.452

	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	))
=	646.618	-	22.375	-	( 269.875	-	max(0, 62.091	-	342.119	+	269.875	))
=	354.368

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

Twist Bioscience (FRA:0ME) 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, Twist Bioscience's WACC % is 17.90%. Twist Bioscience's ROC % is -46.79% (calculated using TTM income statement data). Twist Bioscience 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.

Twist Bioscience ROC % Related Terms

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Twist Bioscience (FRA:0ME) Business Description

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GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Diagnostics & Research » Twist Bioscience Corp (FRA:0ME) » Definitions » ROC %

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TWST:USA 0ME:Germany

Address

681 Gateway Boulevard, South San Francisco, CA, USA, 94080

Website

https://www.twistbioscience.com

Twist Bioscience Corp is a synthetic biology company. It develops a disruptive DNA synthesis platform to industrialize the engineering of biology. The company's DNA synthesis platform utilizes a proprietary semiconductor-based synthetic DNA manufacturing process that synthesizes DNA on silicon instead of on traditional well-plastic plates to enable the production of high-quality synthetic DNA faster and affordable as well as overcomes inefficiencies and powers cost-effective, rapid high-throughput synthesis, enabling researchers to rapidly realize opportunities ahead. Geographically, it derives a majority of its revenue from the United States.

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