# PTC (PTC) ROC % : 9.13% (As of Mar. 2024)

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## What is PTC 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 %. PTC's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 9.13%.

As of today (2024-05-19), PTC's WACC % is 10.31%. PTC's ROC % is 6.01% (calculated using TTM income statement data). PTC earns returns that do not match up to its cost of capital. It will destroy value as it grows.

## PTC ROC % Historical Data

The historical data trend for PTC'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.

### PTC ROC % Chart

PTC Annual Data
Trend Sep14 Sep15 Sep16 Sep17 Sep18 Sep19 Sep20 Sep21 Sep22 Sep23
ROC %
Get a 7-Day Free Trial -6.65 8.66 13.02 9.07 6.29

 PTC Quarterly Data Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 ROC % Get a 7-Day Free Trial 7.09 5.40 3.83 5.89 9.13

## PTC ROC % Calculation

PTC's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2023 is calculated as:

 ROC % (A: Sep. 2023 ) = NOPAT / Average Invested Capital = Operating Income * ( 1 - Tax Rate % ) / ( (Invested Capital (A: Sep. 2022 ) + Invested Capital (A: Sep. 2023 )) / count ) = 458.014 * ( 1 - 26.17% ) / ( (4252.633 + 6491.421) / 2 ) = 338.1517362 / 5372.027 = 6.29 %

where

 Invested Capital (A: Sep. 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 )) = 4687.268 - 162.453 - ( 272.182 - max(0, 792.258 - 1068.657 + 272.182 )) = 4252.633

 Invested Capital (A: 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 )) = 6288.842 - 191.24 - ( 288.103 - max(0, 1671.185 - 1277.366 + 288.103 )) = 6491.421

PTC'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: Dec. 2023 ) + Invested Capital (Q: Mar. 2024 )) / count ) = 718.192 * ( 1 - 21.48% ) / ( (5939.89 + 6418.133) / 2 ) = 563.9243584 / 6179.0115 = 9.13 %

where

 Invested Capital (Q: Dec. 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 )) = 6271.157 - 147.191 - ( 264.997 - max(0, 950.333 - 1134.409 + 264.997 )) = 5939.89

 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 )) = 6205.263 - 149.338 - ( 248.971 - max(0, 1515.016 - 1152.808 + 248.971 )) = 6418.133

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

PTC  (NAS:PTC) 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, PTC's WACC % is 10.31%. PTC's ROC % is 6.01% (calculated using TTM income statement data). PTC 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.

## PTC ROC % Related Terms

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Industry
Comparable Companies
121 Seaport Boulevard, Boston, MA, USA, 02210
Website
PTC offers high-end computer-assisted design (Creo) and product lifecycle management (Windchill) software as well as Internet of Things and AR industrial solutions. Founded in 1985, PTC has 28,000 customers, with revenue stemming mostly from North America (45%) and Europe (40%).
Executives
 Robert Schechter director C/O NMS COMMUNICATIONS, 100 CROSSING BLVD, FRAMINGHAM MA 01702 Kristian Talvitie officer: Chief Financial Officer 121 SEAPORT BOULEVARD, BOSTON MA 02210 Michael Ditullio officer: EVP 121 SEAPORT BLVD, BOSTON MA 02210 Von Staats Aaron C officer: SVP, General Counsel and Clerk C/O PARAMETRIC TECHNOLOGY CORP, 140 KENDRICK ST, NEEDHAM MA 02494 Catherine Kniker officer: Chief Strategy Officer C/O 121 SEAPORT BOULEVARD, BOSTON MA 02210 Paul A Lacy director KRONOS INCORP, 297 BILLERICA RD, CHELMSFORD MA 01824 Lathan Corinna director 140 KENDRICK STREET, NEEDHAM MA 02494 Blake D. Moret director C/O ROCKWELL AUTOMATION, INC., 1201 SOUTH SECOND STREET, MILWAUKEE WI 53204 Neil Barua director, officer: CEO-Elect C/O SERVICEMAX, INC., 4450 ROSEWOOD DRIVE #200, PLEASANTON CA 94588 Janesh Moorjani director C/O ELASTIC N.V., 800 WEST EL CAMINO REAL, SUITE 350, MOUNTAIN VIEW CA 94040 Michal Katz director 42 ROCK SHELTER ROAD, WACCABUC NY 10597 James E Heppelmann officer: EVP, Chief Product Officer C/O PARAMETRIC TECHNOLOGY CORP, 140 KENDRICK ST., NEEDHAM MA 02494 Amarpreet Hanspal director AUTODESK, INC., 111 MCINNIS PARKWAY, SAN RAFAEL CA 94903 Phillip M Fernandez director C/O MARKETO, INC., 901 MARINER'S ISLAND BLVD., SUITE 500, SAN MATEO CA 94404 Mark D Benjamin director NUANCE COMMUNICATIONS, INC., 1 WAYSIDE ROAD, BURLINGTON MA 01803

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