Lever Style (HKSE:01346) ROC % : 26.70% (As of Jun. 2024)

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What is Lever Style 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 %. Lever Style's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 26.70%.

As of today (2024-12-14), Lever Style's WACC % is 6.44%. Lever Style's ROC % is 34.08% (calculated using TTM income statement data). Lever Style generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Lever Style ROC % Historical Data

The historical data trend for Lever Style'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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Lever Style ROC % Chart

Lever Style Annual Data

Trend

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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20.21

22.14

10.75

36.76

32.71

Lever Style Semi-Annual Data
	Dec16	Dec17	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial									22.99	50.44	24.77	40.39	26.70

Lever Style ROC % Calculation

Lever Style'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 )
=	141.092 * ( 1 - 14.56% )	/	( (362.994	+	374.167)	/ 2 )
=	120.5490048	/	368.5805
=	32.71 %

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	))
=	708.713	-	162.575	-	( 183.144	-	max(0, 325.375	-	651.654	+	183.144	))
=	362.994

	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	))
=	695.822	-	180.141	-	( 141.514	-	max(0, 271.57	-	645.753	+	141.514	))
=	374.167

Lever Style's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:

	ROC % (Q: Jun. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Jun. 2024 ))	/ count )
=	111.168 * ( 1 - 14.67% )	/	( (374.167	+	336.329)	/ 2 )
=	94.8596544	/	355.248
=	26.70 %

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	))
=	695.822	-	180.141	-	( 141.514	-	max(0, 271.57	-	645.753	+	141.514	))
=	374.167

	Invested Capital		(Q: Jun. 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	))
=	598.769	-	160.199	-	( 102.241	-	max(0, 181.934	-	553.713	+	102.241	))
=	336.329

Note: The Operating Income data used here is two times the semi-annual (Jun. 2024) data.

Lever Style (HKSE:01346) 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, Lever Style's WACC % is 6.44%. Lever Style's ROC % is 34.08% (calculated using TTM income statement data). Lever Style generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

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.

Lever Style ROC % Related Terms

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Lever Style Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Manufacturing - Apparel & Accessories » Lever Style Corp (HKSE:01346) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

6 Liu Fang Road, 1st Floor, TinWe Mansion, Bao’an District, Shenzhen, CHN

Website

https://www.leverstyle.com

Lever Style Corp engages in apparel manufacturing. The firm offers a wide range of product categories for both men and women. Its product line comprises shirts, bottoms, suits, outwear, and other products out of which the sale of shirts derives the majority of revenue. Geographically, the company generates revenue from the United States of America, Europe, Oceania, Greater China, and Others. The majority of its revenue is generated from the United States.

Executives

Imaginative Company Limited	2201 Interest of corporation controlled by you
Lever Style Holdings Limited	2101 Beneficial owner
Szeto Chi Yan Stanley	2201 Interest of corporation controlled by you
Fung Capital Limited	2201 Interest of corporation controlled by you
Hsbc Trustee (c.i.) Limited	2301 Trustee
Fung Portfolio Limited	2201 Interest of corporation controlled by you
Fung Kwok Lun William	2201 Interest of corporation controlled by you
Jing Lun Kong Gu You Xian Gong Si	2201 Interest of corporation controlled by you
Feng Shi Tou Zi You Xian Gong Si	2201 Interest of corporation controlled by you
Poolside Ventures Limited	2201 Interest of corporation controlled by you
Kci Limited	2201 Interest of corporation controlled by you
Fung Trinity Holdings Limited	2101 Beneficial owner
Fong Tong	2201 Interest of corporation controlled by you

Lever Style Headlines

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