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Micron Technology (MIL:1MU) ROC % : 6.66% (As of Aug. 2024)


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What is Micron Technology 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 %. Micron Technology's annualized return on capital (ROC %) for the quarter that ended in Aug. 2024 was 6.66%.

As of today (2024-12-12), Micron Technology's WACC % is 11.89%. Micron Technology's ROC % is 1.54% (calculated using TTM income statement data). Micron Technology earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Micron Technology ROC % Historical Data

The historical data trend for Micron Technology'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.

Micron Technology ROC % Chart

Micron Technology Annual Data
Trend Aug15 Aug16 Aug17 Aug18 Aug19 Aug20 Aug21 Aug22 Aug23 Aug24
ROC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 7.08 14.98 19.68 -10.68 1.51

Micron Technology Quarterly Data
Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23 Feb24 May24 Aug24
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 -10.60 -9.49 6.61 2.46 6.66

Micron Technology ROC % Calculation

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

ROC % (A: Aug. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Aug. 2023 ) + Invested Capital (A: Aug. 2024 ))/ count )
=1130.122 * ( 1 - 36.37% )/( (46493.734 + 48987.977)/ 2 )
=719.0966286/47740.8555
=1.51 %

where

Invested Capital(A: Aug. 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))
=58920.918 - 3629.486 - ( 8797.698 - max(0, 4369.505 - 19480.748+8797.698))
=46493.734

Invested Capital(A: Aug. 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))
=62960.312 - 6620.193 - ( 7352.142 - max(0, 8387.936 - 22105.404+7352.142))
=48987.977

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

ROC % (Q: Aug. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: May. 2024 ) + Invested Capital (Q: Aug. 2024 ))/ count )
=5539.956 * ( 1 - 41.26% )/( (48776.175 + 48987.977)/ 2 )
=3254.1701544/48882.076
=6.66 %

where

Invested Capital(Q: May. 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))
=61285.875 - 4759.125 - ( 7750.575 - max(0, 6327 - 21570.075+7750.575))
=48776.175

Invested Capital(Q: Aug. 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))
=62960.312 - 6620.193 - ( 7352.142 - max(0, 8387.936 - 22105.404+7352.142))
=48987.977

Note: The Operating Income data used here is four times the quarterly (Aug. 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.


Micron Technology  (MIL:1MU) 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, Micron Technology's WACC % is 11.89%. Micron Technology's ROC % is 1.54% (calculated using TTM income statement data). Micron Technology 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.


Micron Technology ROC % Related Terms

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Micron Technology Business Description

Address
8000 South Federal Way, Post Office Box 6, Boise, ID, USA, 83716-9632
Micron is one of the largest semiconductor companies in the world, specializing in memory and storage chips. Its primary revenue stream comes from dynamic random access memory, or DRAM, and it also has minority exposure to not-and or NAND, flash chips. Micron serves a global customer base, selling chips into data centers, mobile phones, consumer electronics, and industrial and automotive applications. The firm is vertically integrated.

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