Davi Luxury Brand Group (Davi Luxury Brand Group) ROC % : -159.45% (As of Mar. 2014)

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What is Davi Luxury Brand Group 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 %. Davi Luxury Brand Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2014 was -159.45%.

As of today (2024-06-03), Davi Luxury Brand Group's WACC % is 0.00%. Davi Luxury Brand Group's ROC % is 0.00% (calculated using TTM income statement data). Davi Luxury Brand Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Davi Luxury Brand Group ROC % Historical Data

The historical data trend for Davi Luxury Brand Group'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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Davi Luxury Brand Group ROC % Chart

Davi Luxury Brand Group Annual Data

Trend

Sep08

Sep09

Sep10

Sep11

Sep12

Sep13

ROC %

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-229.80

-84.31

-175.58

Davi Luxury Brand Group Quarterly Data
	Jun09	Sep09	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14
ROC %	Get a 7-Day Free Trial															-214.05	-39.69	-414.44	-235.90	-159.45

Davi Luxury Brand Group ROC % Calculation

Davi Luxury Brand Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2013 is calculated as:

	ROC % (A: Sep. 2013 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2012 )	+	Invested Capital (A: Sep. 2013 ))	/ count )
=	-0.568 * ( 1 - 0% )	/	( (0.331	+	0.316)	/ 2 )
=	-0.568	/	0.3235
=	-175.58 %

where

	Invested Capital		(A: Sep. 2012 )
=	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	))
=	0.721	-	0.21	-	( 0.347	-	max(0, 0.451	-	0.631	+	0.347	))
=	0.331

	Invested Capital		(A: Sep. 2013 )
=	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	))
=	0.872	-	0.241	-	( 0.654	-	max(0, 0.425	-	0.74	+	0.654	))
=	0.316

Davi Luxury Brand Group's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2014 is calculated as:

	ROC % (Q: Mar. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2013 )	+	Invested Capital (Q: Mar. 2014 ))	/ count )
=	-0.468 * ( 1 - 0% )	/	( (0.308	+	0.279)	/ 2 )
=	-0.468	/	0.2935
=	-159.45 %

where

	Invested Capital		(Q: Dec. 2013 )
=	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	))
=	0.778	-	0.218	-	( 0.53	-	max(0, 0.391	-	0.643	+	0.53	))
=	0.308

	Invested Capital		(Q: Mar. 2014 )
=	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	))
=	0.625	-	0.173	-	( 0.427	-	max(0, 0.325	-	0.498	+	0.427	))
=	0.279

Note: The Operating Income data used here is four times the quarterly (Mar. 2014) data.

Davi Luxury Brand Group (OTCPK:MDAV) 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, Davi Luxury Brand Group's WACC % is 0.00%. Davi Luxury Brand Group's ROC % is 0.00% (calculated using TTM income statement data). Davi Luxury Brand Group 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.

Davi Luxury Brand Group ROC % Related Terms

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Davi Luxury Brand Group (Davi Luxury Brand Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Davi Luxury Brand Group Inc (OTCPK:MDAV) » Definitions » ROC %

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Traded in Other Exchanges

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Address

9426 Dayton Way, Beverly Hills, CA, USA, 90210

Website

http://www.daviskin.com

Davi Luxury Brand Group Inc is a skin care (cosmetics) company that offers a grape-vineyard, botanical based skin care products marketed under the Company's 'DAVI', 'DAVI NAPA' and 'DAVI SKIN' brand names. All of its products are, or will be sold 'over the counter.' Through licensing and other arrangements, its products are available in high-end retail stores in Asia, luxury hotels worldwide, and in-flight and duty-free shops of a global luxury airline. The Company's products compete against similar, branded products of many large and small companies.

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