Lobe Sciences (FRA:6YX0) ROC % : -110.80% (As of May. 2024)

View and export this data going back to 2021. Start your Free Trial

What is Lobe Sciences 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 %. Lobe Sciences's annualized return on capital (ROC %) for the quarter that ended in May. 2024 was -110.80%.

As of today (2024-12-14), Lobe Sciences's WACC % is 5.80%. Lobe Sciences's ROC % is -125.73% (calculated using TTM income statement data). Lobe Sciences earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Lobe Sciences ROC % Historical Data

The historical data trend for Lobe Sciences'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.

* Premium members only.

Lobe Sciences ROC % Chart

Lobe Sciences Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Aug19

Aug20

Aug21

Aug22

Aug23

ROC %

Get a 7-Day Free Trial

-50.45

-29.72

-79.12

-199.81

-225.57

Lobe Sciences Quarterly Data
	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23	Aug23	Nov23	Feb24	May24
ROC %	Get a 7-Day Free Trial															-149.01	-189.58	-94.82	-102.75	-110.80

Lobe Sciences ROC % Calculation

Lobe Sciences's annualized Return on Capital (ROC %) for the fiscal year that ended in Aug. 2023 is calculated as:

	ROC % (A: Aug. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Aug. 2022 )	+	Invested Capital (A: Aug. 2023 ))	/ count )
=	-2.285 * ( 1 - -4.54% )	/	( (0.544	+	1.574)	/ 2 )
=	-2.388739	/	1.059
=	-225.57 %

where

	Invested Capital		(A: Aug. 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	))
=	1.336	-	0.995	-	( 0.694	-	max(0, 0.995	-	0.792	+	0.694	))
=	0.544

	Invested Capital		(A: Aug. 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	))
=	1.564	-	1.447	-	( 0.095	-	max(0, 1.674	-	0.217	+	0.095	))
=	1.574

Lobe Sciences's annualized Return on Capital (ROC %) for the quarter that ended in May. 2024 is calculated as:

	ROC % (Q: May. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Feb. 2024 )	+	Invested Capital (Q: May. 2024 ))	/ count )
=	-1.688 * ( 1 - 0% )	/	( (1.574	+	1.473)	/ 2 )
=	-1.688	/	1.5235
=	-110.80 %

where

	Invested Capital		(Q: Feb. 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	))
=	1.448	-	2.043	-	( 0.003	-	max(0, 2.296	-	0.127	+	0.003	))
=	1.574

	Invested Capital		(Q: May. 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	))
=	1.327	-	0.582	-	( 0.02	-	max(0, 0.772	-	0.044	+	0.02	))
=	1.473

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

Lobe Sciences (FRA:6YX0) 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, Lobe Sciences's WACC % is 5.80%. Lobe Sciences's ROC % is -125.73% (calculated using TTM income statement data). Lobe Sciences 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.

Lobe Sciences ROC % Related Terms

Thank you for viewing the detailed overview of Lobe Sciences's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.

Lobe Sciences Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Biotechnology » Lobe Sciences Ltd (FRA:6YX0) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

LOBEF:USA LOBE:Canada

Address

1199 West Hastings Street, Suite 1400, Vancouver, BC, CAN, V6E 3T5

Website

https://www.lobesciences.com

Lobe Sciences Ltd is a biopharmaceutical company committed to discovering and developing patient-focused medicines for orphan and rare diseases. It is engaged in drug research and development to improve brain and mental health and wellness. The company plans to commercialize a medical food named Altemia for the treatment of Sickle Cell Disease and has other drugs in pipeline such as L-130 Treatment for Chronic Cluster Headache, L-131 Treatment for Pediatric Anxiety and S-100 Treatment for Sickle Cell Disease.

Lobe Sciences Headlines

No Headlines