Dongfeng Motor Group Co (FRA:D4D) ROC % : -6.47% (As of Dec. 2023)

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What is Dongfeng Motor Group Co 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 %. Dongfeng Motor Group Co's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -6.47%.

As of today (2024-05-21), Dongfeng Motor Group Co's WACC % is 3.79%. Dongfeng Motor Group Co's ROC % is -4.62% (calculated using TTM income statement data). Dongfeng Motor Group Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Dongfeng Motor Group Co ROC % Historical Data

The historical data trend for Dongfeng Motor Group Co'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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Dongfeng Motor Group Co ROC % Chart

Dongfeng Motor Group Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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2.82

3.28

1.97

-4.16

-4.45

Dongfeng Motor Group Co Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial															1.42	-2.50	-6.69	-2.13	-6.47

Dongfeng Motor Group Co ROC % Calculation

Dongfeng Motor Group Co's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-1029.991 * ( 1 - -6.7% )	/	( (24844.706	+	24563.61)	/ 2 )
=	-1099.000397	/	24704.158
=	-4.45 %

where

	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	))
=	44688.381	-	12676.034	-	( 12263.05	-	max(0, 17611.936	-	24779.577	+	12263.05	))
=	24844.706

	Invested Capital		(A: 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	))
=	42468.24	-	12042.416	-	( 13499.429	-	max(0, 17076.014	-	22938.228	+	13499.429	))
=	24563.61

Dongfeng Motor Group Co'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: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-1451.234 * ( 1 - -5.82% )	/	( (22886.054	+	24563.61)	/ 2 )
=	-1535.6958188	/	23724.832
=	-6.47 %

where

	Invested Capital		(Q: 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	))
=	40819.428	-	10815.162	-	( 12194.751	-	max(0, 14534.924	-	21653.136	+	12194.751	))
=	22886.054

	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	))
=	42468.24	-	12042.416	-	( 13499.429	-	max(0, 17076.014	-	22938.228	+	13499.429	))
=	24563.61

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

Dongfeng Motor Group Co (FRA:D4D) 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, Dongfeng Motor Group Co's WACC % is 3.79%. Dongfeng Motor Group Co's ROC % is -4.62% (calculated using TTM income statement data). Dongfeng Motor Group Co 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.

Dongfeng Motor Group Co ROC % Related Terms

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Dongfeng Motor Group Co (FRA:D4D) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » Dongfeng Motor Group Co Ltd (FRA:D4D) » Definitions » ROC %

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Traded in Other Exchanges

DNFGY:USA DNFGF:USA 00489:Hong Kong

Address

Special No. 1 Dongfeng Road, Wuhan Economic and Technology Development Zone, Hubei, Wuhan, CHN, 430056

Website

https://www.dfmg.com.cn

Dongfeng Motor Group Co Ltd is engaged in vehicle manufacturing, covering other complete business systems relating to automobiles such as R&D of automobiles, parts and equipment manufacturing, automobile finance, automobile sales, and travel business. The company's segments include commercial vehicles, passenger vehicles, financing services, and corporate and others. The majority of its revenue is generated from the Passenger vehicles segment.

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