Max Sound (Max Sound) ROC % : -5.71% (As of Jun. 2022)

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What is Max Sound 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 %. Max Sound's annualized return on capital (ROC %) for the quarter that ended in Jun. 2022 was -5.71%.

As of today (2024-05-18), Max Sound's WACC % is 0.00%. Max Sound's ROC % is 0.00% (calculated using TTM income statement data). Max Sound earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Max Sound ROC % Historical Data

The historical data trend for Max Sound'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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Max Sound ROC % Chart

Max Sound Annual Data

Trend

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

ROC %

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-17.61

-9.35

-4.66

-7.49

-5.88

Max Sound Quarterly Data
	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22
ROC %	Get a 7-Day Free Trial															-20.51	-5.53	-7.87	-8.23	-5.71

Max Sound ROC % Calculation

Max Sound's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2021 is calculated as:

	ROC % (A: Dec. 2021 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2020 )	+	Invested Capital (A: Dec. 2021 ))	/ count )
=	-0.378 * ( 1 - 0% )	/	( (6.563	+	6.304)	/ 2 )
=	-0.378	/	6.4335
=	-5.88 %

where

	Invested Capital		(A: Dec. 2020 )
=	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	))
=	0	-	6.09	-	( 0	-	max(0, 12.653	-	0	+	0	))
=	6.563

	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	))
=	0	-	7.464	-	( 0	-	max(0, 13.768	-	0	+	0	))
=	6.304

Max Sound's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2022 is calculated as:

	ROC % (Q: Jun. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2022 )	+	Invested Capital (Q: Jun. 2022 ))	/ count )
=	-0.356 * ( 1 - 0% )	/	( (6.332	+	6.127)	/ 2 )
=	-0.356	/	6.2295
=	-5.71 %

where

	Invested Capital		(Q: Mar. 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	))
=	0	-	7.817	-	( 0	-	max(0, 14.149	-	0	+	0	))
=	6.332

	Invested Capital		(Q: Jun. 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	))
=	0	-	8.148	-	( 0	-	max(0, 14.275	-	0	+	0	))
=	6.127

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

Max Sound (OTCPK:MAXD) 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, Max Sound's WACC % is 0.00%. Max Sound's ROC % is 0.00% (calculated using TTM income statement data). Max Sound 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.

Max Sound ROC % Related Terms

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Max Sound (Max Sound) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Max Sound Corp (OTCPK:MAXD) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

3525 Del Mar Heights Road, Suite 802, San Diego, CA, USA, 92130

Website

https://www.maxd.audio

Max Sound Corp sells, and licenses products and services based on its patent MAX-D HD Audio Technology for sound recording and playback that improves the listener's experience. The MAXD-D HD Audio Technology converts audio files into high definition for better sound without increasing the file size. Its products and services are provided to various markets including motion picture, music recording, video game, broadcasting, internet video and audio, automobile infotainment systems and consumer electronics. The company derives its revenue by licensing its MAX-D technology.

Executives

John Blaisure	director, 10 percent owner, officer: Chief Executive Officer	6450 TORREYANNA CIRCLE, CARLSBAD CA 92011
Lloyd Trammell	10 percent owner, officer: Chief Technical Officer	12323 STEEPLE LANE, HOUSTON TX 77039
Gregory J. Halpern	director, 10 percent owner, officer: CEO, CFO, PAO	5715 WILL CLAYTON PARKWAY, #6572, HUMBLE TX 77338