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FRGAP.PFD (Franchise Group) ROC % : 2.30% (As of Jun. 2023)


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What is Franchise Group 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 %. Franchise Group's annualized return on capital (ROC %) for the quarter that ended in Jun. 2023 was 2.30%.

As of today (2024-12-15), Franchise Group's WACC % is 10.43%. Franchise Group's ROC % is 4.19% (calculated using TTM income statement data). Franchise Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Franchise Group ROC % Historical Data

The historical data trend for Franchise Group'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.

Franchise Group ROC % Chart

Franchise Group Annual Data
Trend Apr13 Apr14 Apr15 Apr16 Apr17 Apr18 Apr19 Dec20 Dec21 Dec22
ROC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 0.26 - -1.37 11.48 8.08

Franchise Group Quarterly Data
Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23
ROC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 7.09 7.37 0.06 5.80 2.30

Franchise Group ROC % Calculation

Franchise Group'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 )
=291.207 * ( 1 - 11.42% )/( (3209.905 + 3172.734)/ 2 )
=257.9511606/3191.3195
=8.08 %

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))
=3913.171 - 410.552 - ( 292.714 - max(0, 1120.656 - 1478.212+292.714))
=3209.905

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))
=3630.412 - 376.895 - ( 80.783 - max(0, 943.911 - 1316.499+80.783))
=3172.734

Franchise Group's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2023 is calculated as:

ROC % (Q: Jun. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2023 ) + Invested Capital (Q: Jun. 2023 ))/ count )
=90 * ( 1 - 21.42% )/( (3093.331 + 3058.054)/ 2 )
=70.722/3075.6925
=2.30 %

where

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))
=3607.262 - 415.665 - ( 98.266 - max(0, 1060.527 - 1337.49+98.266))
=3093.331

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))
=3571.861 - 407.543 - ( 106.264 - max(0, 975.956 - 1336.717+106.264))
=3058.054

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

* 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.


Franchise Group  (NAS:FRGAP.PFD) 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, Franchise Group's WACC % is 10.43%. Franchise Group's ROC % is 4.19% (calculated using TTM income statement data). Franchise Group 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.


Franchise Group ROC % Related Terms

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Franchise Group Business Description

Traded in Other Exchanges
N/A
Address
109 Innovation Court, Suite J, Delaware, OH, USA, 43015
Franchise Group Inc is a personal services company that provides retail federal and state income tax preparation services and related tax settlement products. The vast majority of these offices operate in the United States under the Liberty Tax Service and SiempreTax+ brand names. Liberty Tax also provides online do-it-yourself tax programs within the U.S. The sale of financial products and tax preparation service fees also contribute to sizable percentages of the company's total income. Liberty Tax also operates a smaller portfolio of wholly-owned company offices. The company's reportable segments are Vitamin Shoppe, Pet Supplies Plus, Badcock, American Freight, Buddy's and Sylvan.
Executives
Daniel Meitner Ondeck 10 percent owner 13301 BEALL CREEK CT., POTOMAC MD 20854
Richard W Riley 10 percent owner B RILEY AND CO, 11100 SANTA MONICA BLVD STE 800, LOS ANGELES CA 90025
Randall E Paulson 10 percent owner
Kelleher Thomas J /adv 10 percent owner C/O B. RILEY FINANCIAL, INC., 21255 BURBANK BLVD, SUITE 400, WOODLAND HILLS CA 91367
Gary S Rich director C/O THE READER'S DIGEST ASSOCIATION, READER'S DIGEST ROAD, PLEASANTVILLE NY 10570
Nanhi Singh director 109 INNOVATION COURT, SUITE J, DELAWARE OH 43015
Lee A. Wright officer: Chief Commercial Officer C/O DIAMOND CASTLE HOLDINGS, LLC, 280 PARK AVENUE, 25TH FLOOR, EAST TOWER, NEW YORK NY 10017
Cynthia S Dubin director 1200 E. MARKET STREET, SUITE 650, AKRON OH 44305
Lisa M Fairfax director 2387 LIBERTY WAY, VIRGINIA BEACH VA 23456
K Todd Evans officer: Chief Franchising Officer 309 E. PACES FERRY RD N.E., ATLANTA GA 30305-2377
Dialectic Antithesis Partners, Lp 10 percent owner 119 ROWAYTON AVENUE, 2ND FLOOR, NORWALK CT 06853
Brc Partners Management Gp, Llc 10 percent owner 11100 SANTA MONICA BLVD SUITE 800, LOS ANGELES CA 90025
B. Riley Securities, Inc. 10 percent owner 11100 SANTA MONICA BLVD, SUITE 800, LOS ANGELES CA 90025
Br Dialectic Capital Management, Llc 10 percent owner 11100 SANTA MONICA BLVD., SUITE 800, LOS ANGELES CA 90025
Vintage Capital Management Llc director, 10 percent owner, officer: Chief Executive Officer 4705 S APOPKA VINELAND ROAD SUITE 210, ORLANDO FL 32819

Franchise Group Headlines

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