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Soitec (LTS:0RMT) ROC % : 12.69% (As of Mar. 2024)


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What is Soitec 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 %. Soitec's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 12.69%.

As of today (2024-12-13), Soitec's WACC % is 8.78%. Soitec's ROC % is 11.86% (calculated using TTM income statement data). Soitec 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.


Soitec ROC % Historical Data

The historical data trend for Soitec'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.

Soitec ROC % Chart

Soitec Annual Data
Trend Mar15 Mar16 Mar17 Mar18 Mar19 Mar20 Mar21 Mar22 Mar23 Mar24
ROC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 18.75 12.01 20.63 19.73 11.84

Soitec Semi-Annual Data
Mar15 Sep15 Mar16 Sep16 Mar17 Sep17 Mar18 Sep18 Mar19 Sep19 Mar20 Sep20 Mar21 Sep21 Mar22 Sep22 Mar23 Sep23 Mar24 Sep24
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 17.05 22.55 10.95 12.69 -

Soitec ROC % Calculation

Soitec's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2024 is calculated as:

ROC % (A: Mar. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Mar. 2023 ) + Invested Capital (A: Mar. 2024 ))/ count )
=205.968 * ( 1 - 11.33% )/( (1356.846 + 1729.377)/ 2 )
=182.6318256/1543.1115
=11.84 %

where

Invested Capital(A: 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))
=2419.989 - 273.676 - ( 789.467 - max(0, 476.397 - 1435.26+789.467))
=1356.846

Invested Capital(A: Mar. 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))
=2692.185 - 250.07 - ( 712.738 - max(0, 457.422 - 1471.865+712.738))
=1729.377

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

ROC % (Q: Mar. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Sep. 2023 ) + Invested Capital (Q: Mar. 2024 ))/ count )
=237.908 * ( 1 - 13.03% )/( (1531.802 + 1729.377)/ 2 )
=206.9085876/1630.5895
=12.69 %

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))
=2439.059 - 237.845 - ( 669.412 - max(0, 364.991 - 1281.322+669.412))
=1531.802

Invested Capital(Q: Mar. 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))
=2692.185 - 250.07 - ( 712.738 - max(0, 457.422 - 1471.865+712.738))
=1729.377

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


Soitec  (LTS:0RMT) 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, Soitec's WACC % is 8.78%. Soitec's ROC % is 11.86% (calculated using TTM income statement data). Soitec 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.


Soitec ROC % Related Terms

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Soitec Business Description

Address
Parc Technologique des Fontaines, Chemin des Franques, Bernin, FRA, 38190
Soitec is a French company that manufactures and sells engineered wafers for the semiconductor industry. Soitec is the number-one provider of silicon-on-insulator wafers worldwide and also provides other engineered substrates like gallium nitride or silicon carbide. Soitec sells wafers to fabrication plants that use the them to produce chips. Soitec has facilities in France, Singapore, and China and plans to expand its capacity by 75% from 2022 to 2026.

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