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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Krystal Biotech's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 5.35%.
As of today (2024-05-01), Krystal Biotech's WACC % is 7.06%. Krystal Biotech's ROC % is -47.39% (calculated using TTM income statement data). Krystal Biotech earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Krystal Biotech'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.
Krystal Biotech Annual Data | |||||||||||||||||
Trend | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | Dec21 | Dec22 | Dec23 | |||||||||
ROC % | Get a 7-Day Free Trial | -257.65 | -114.41 | -59.58 | -66.47 | -38.04 |
Krystal Biotech Quarterly Data | ||||||||||||||||||||
Mar19 | Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | Jun23 | Sep23 | Dec23 | |
ROC % | Get a 7-Day Free Trial | -77.85 | -81.90 | -80.00 | -50.20 | 5.35 |
Krystal Biotech'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 ) |
= | -97.227 * ( 1 - 15.24% ) | / | ( (176.499 | + | 256.767) | / 2 ) |
= | -82.4096052 | / | 216.633 | |||
= | -38.04 % |
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 | )) |
= | 558.45 | - | 27.019 | - | ( 379.171 | - | max(0, 28.847 | - | 383.779 | + | 379.171 | )) |
= | 176.499 |
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 | )) |
= | 818.355 | - | 29.41 | - | ( 532.178 | - | max(0, 33.094 | - | 587.909 | + | 532.178 | )) |
= | 256.767 |
Krystal Biotech'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: Sep. 2023 ) | + | Invested Capital (Q: Dec. 2023 )) | / count ) |
= | 12.552 * ( 1 - 0% ) | / | ( (212.038 | + | 256.767) | / 2 ) |
= | 12.552 | / | 234.4025 | |||
= | 5.35 % |
where
Invested Capital | (Q: Sep. 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 | )) |
= | 790.35 | - | 23.767 | - | ( 562.069 | - | max(0, 27.583 | - | 582.128 | + | 562.069 | )) |
= | 212.038 |
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 | )) |
= | 818.355 | - | 29.41 | - | ( 532.178 | - | max(0, 33.094 | - | 587.909 | + | 532.178 | )) |
= | 256.767 |
Note: The Operating Income data used here is four times the quarterly (Dec. 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.
Krystal Biotech (NAS:KRYS) 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, Krystal Biotech's WACC % is 7.06%. Krystal Biotech's ROC % is -47.39% (calculated using TTM income statement data). Krystal Biotech 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.
Thank you for viewing the detailed overview of Krystal Biotech's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Krish S Krishnan | director, 10 percent owner, officer: President and CEO | 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Suma Krishnan | director, 10 percent owner, officer: Chief Operating Officer | 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Catherine Mazzacco | director | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Daniel Janney | director | PO BOX 7414, JACKSON WY 83002 |
Andrew C. Orth | officer: Chief Commercial Officer | 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Kathryn Romano | officer: Chief Accounting Officer | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Dino A Rossi | director | 61 WATROO POINT, DANIEL ISLAND SC 29492 |
Everett Rand Sutherland | director | 29 HARTWELL AVENUE, LEXINGTON MA 02421 |
Christopher Mason | director | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Jing L. Marantz | director | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Julian S Gangolli | director | 4955 BASELINE AVENUE, SANTA YNEZ CA 93460 |
Jennifer Chien | officer: Chief Commercial Officer | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203 |
Antony A Riley | officer: Chief Financial Officer | C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 94538 |
R Douglas Norby | director | C/O MAGNACHIP SEMICONDUCTOR, INC., 20400 STEVENS CREEK BOULEVARD, SUITE 370, CUPERTINO CA 95014 |
Sun Pharma (netherlands) B.v. | 10 percent owner | POLARISAVENUE 87, 2132 JH HOOFDDORP P7 00000 |
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