IMPHP.PFD (Impac Mortgage Holdings) ROC % : -94.70% (As of Dec. 2022)

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What is Impac Mortgage Holdings 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 %. Impac Mortgage Holdings's annualized return on capital (ROC %) for the quarter that ended in Dec. 2022 was -94.70%.

As of today (2024-12-11), Impac Mortgage Holdings's WACC % is 4.02%. Impac Mortgage Holdings's ROC % is -10.13% (calculated using TTM income statement data). Impac Mortgage Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Impac Mortgage Holdings ROC % Historical Data

The historical data trend for Impac Mortgage Holdings'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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Impac Mortgage Holdings ROC % Chart

Impac Mortgage Holdings Annual Data

Trend

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

ROC %

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-0.54

-0.17

-3.07

-0.70

-4.69

Impac Mortgage Holdings Quarterly Data
	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22
ROC %	Get a 7-Day Free Trial															-1.10	-4.53	-41.80	-73.68	-94.70

Impac Mortgage Holdings ROC % Calculation

Impac Mortgage Holdings'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 )
=	-47.53 * ( 1 - -0.1% )	/	( (1993.216	+	34.467)	/ 2 )
=	-47.57753	/	1013.8415
=	-4.69 %

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	))
=	2022.771	-	0	-	( 29.555	-	max(0, 285.539	-	1996.176	+	29.555	))
=	1993.216

	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	))
=	60.331	-	0	-	( 25.864	-	max(0, 3.622	-	47.192	+	25.864	))
=	34.467

Impac Mortgage Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2022 is calculated as:

	ROC % (Q: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2022 )	+	Invested Capital (Q: Dec. 2022 ))	/ count )
=	-39.824 * ( 1 - 0.07% )	/	( (49.577	+	34.467)	/ 2 )
=	-39.7961232	/	42.022
=	-94.70 %

where

	Invested Capital		(Q: 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	))
=	93.585	-	0	-	( 44.008	-	max(0, 13.292	-	66.624	+	44.008	))
=	49.577

	Invested Capital		(Q: 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	))
=	60.331	-	0	-	( 25.864	-	max(0, 3.622	-	47.192	+	25.864	))
=	34.467

Note: The Operating Income data used here is four times the quarterly (Dec. 2022) data.

Impac Mortgage Holdings (OTCPK:IMPHP.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, Impac Mortgage Holdings's WACC % is 4.02%. Impac Mortgage Holdings's ROC % is -10.13% (calculated using TTM income statement data). Impac Mortgage Holdings 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.

Impac Mortgage Holdings ROC % Related Terms

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Impac Mortgage Holdings Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Impac Mortgage Holdings Inc (OTCPK:IMPHP.PFD) » Definitions » ROC %

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Address

4000 MacArthur Boulevard, Suite 6000, Newport Beach, CA, USA, 92660

Website

https://www.impaccompanies.com

Impac Mortgage Holdings Inc is an independent residential mortgage lender. The company's segments include Mortgage Lending, Real Estate Services, and the Long-Term Mortgage Portfolio. The mortgage lending segment provides mortgage lending products through three lending channels, retail, wholesale, and correspondent, retains mortgage servicing rights, and provides warehouse lending facilities. Its Real estate services segment performs master servicing and provides loss mitigation services for securitized long-term mortgage portfolios, and Long-term mortgage portfolio consists of residual interests in securitization trusts.