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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 %. Outerwall's annualized return on capital (ROC %) for the quarter that ended in Jun. 2016 was 22.22%.
As of today (2024-05-06), Outerwall's WACC % is 0.00%. Outerwall's ROC % is 0.00% (calculated using TTM income statement data). Outerwall earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Outerwall'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.
Outerwall Annual Data | |||||||||||||||||||||
Trend | Dec06 | Dec07 | Dec08 | Dec09 | Dec10 | Dec11 | Dec12 | Dec13 | Dec14 | Dec15 | |||||||||||
ROC % | Get a 7-Day Free Trial | 14.53 | 18.18 | 19.85 | 14.45 | 6.78 |
Outerwall Quarterly Data | ||||||||||||||||||||
Sep11 | Dec11 | Mar12 | Jun12 | Sep12 | Dec12 | Mar13 | Jun13 | Sep13 | Dec13 | Mar14 | Jun14 | Sep14 | Dec14 | Mar15 | Jun15 | Sep15 | Dec15 | Mar16 | Jun16 | |
ROC % | Get a 7-Day Free Trial | -11.22 | 19.82 | 9.26 | 17.26 | 22.22 |
Outerwall's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2015 is calculated as:
ROC % (A: Dec. 2015 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Dec. 2014 ) | + | Invested Capital (A: Dec. 2015 )) | / count ) |
= | 168.875 * ( 1 - 59.82% ) | / | ( (1105.633 | + | 895.249) | / 2 ) |
= | 67.853975 | / | 1000.441 | |||
= | 6.78 % |
where
Invested Capital | (A: Dec. 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 | )) |
= | 1583.286 | - | 418.892 | - | ( 242.696 | - | max(0, 452.465 | - | 511.226 | + | 242.696 | )) |
= | 1105.633 |
Invested Capital | (A: Dec. 2015 ) | |||||||||||
= | 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 | )) |
= | 1366.06 | - | 427.616 | - | ( 222.549 | - | max(0, 457.676 | - | 500.871 | + | 222.549 | )) |
= | 895.249 |
Outerwall's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2016 is calculated as:
ROC % (Q: Jun. 2016 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Mar. 2016 ) | + | Invested Capital (Q: Jun. 2016 )) | / count ) |
= | 287.388 * ( 1 - 34.13% ) | / | ( (863.37 | + | 840.253) | / 2 ) |
= | 189.3024756 | / | 851.8115 | |||
= | 22.22 % |
where
Invested Capital | (Q: Mar. 2016 ) | |||||||||||
= | 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 | )) |
= | 1265.14 | - | 392.512 | - | ( 198.85 | - | max(0, 424.016 | - | 433.274 | + | 198.85 | )) |
= | 863.37 |
Invested Capital | (Q: Jun. 2016 ) | |||||||||||
= | 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 | )) |
= | 1226.664 | - | 367.791 | - | ( 199.048 | - | max(0, 400.751 | - | 419.371 | + | 199.048 | )) |
= | 840.253 |
Note: The Operating Income data used here is four times the quarterly (Jun. 2016) 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.
Outerwall (NAS:OUTR) 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, Outerwall's WACC % is 0.00%. Outerwall's ROC % is 0.00% (calculated using TTM income statement data). Outerwall 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 Outerwall's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Erik Prusch | director, officer: Chief Executive Officer | C/O CLEARWIRE CORPORATION, 4400 CARILLON POINT, KIRKLAND WA 98033 |
Nora Denzel | director | C/O OVERLAND STORAGE, INC., 4820 OVERLAND AVENUE, SAN DIEGO CA 92123 |
Jeffrey J Brown | director | 19900 MACARTHUR BLVD, SUITE 570, IRVINE CA 92612 |
Robert D Sznewajs | director | |
Nelson C Chan | director | C/O SYNAPTICS INCORPORATED, 1251 MCKAY DRIVE, SAN JOSE CA 95131 |
Glenn W. Welling | other: See Footnote 1 | 610 NEWPORT CENTER DRIVE, SUITE 950, NEWPORT BEACH CA 92660 |
Engaged Capital Holdings, Llc | other: See Footnote 1 | 610 NEWPORT CENTER DRIVE, SUITE 950, NEWPORT BEACH CA 92660 |
Engaged Capital Flagship Master Fund, Lp | other: See Footnote 1 | CRICKET SQUARE, HUTCHINS DRIVE, P.O. BOX 2681, GRAND CAYMAN E9 KY1-1111 |
Engaged Capital Flagship Fund, L.p. | other: See Footnote 1 | 610 NEWPORT CENTER DRIVE, SUITE 250, NEWPORT BEACH CA 90272 |
Engaged Capital Llc | other: See Footnote 1 | 610 NEWPORT CENTER DRIVE, SUITE 950, NEWPORT BEACH CA 92660 |
Engaged Capital Flagship Fund, Ltd. | other: See Footnote 1 | 610 NEWPORT CENTER DRIVE, SUITE 250, NEWPORT BEACH CA 92660 |
Engaged Capital I Lp | other: See Footnote 1 and 6 | 610 NEWPORT CENTER DRIVE, SUITE 250, NEWPORT BEACH CA 90272 |
Engaged Capital I Offshore Ltd | other: See Footnote 1 and 6 | 610 NEWPORT CENTER DRIVE, SUITE 250, NEWPORT BEACH CA 92660 |
Engaged Capital Master Feeder I, Lp | other: See Footnote 1 and 6 | CRICKET SQUARE, HUTCHINS DRIVE, P.O. BOX 2681, GRAND CAYMAN E9 KY1-1111 |
Park West Asset Management Llc | other: Former ten percent (10%) owner | 1 LETTERMAN DRIVE, SUITE C5-900, SAN FRANCISCO CA 94129 |
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