Reven Housing REIT (Reven Housing REIT) ROC % : -0.92% (As of Jun. 2019)

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What is Reven Housing REIT 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 %. Reven Housing REIT's annualized return on capital (ROC %) for the quarter that ended in Jun. 2019 was -0.92%.

As of today (2024-05-27), Reven Housing REIT's WACC % is 0.00%. Reven Housing REIT's ROC % is 0.00% (calculated using TTM income statement data). Reven Housing REIT earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Reven Housing REIT ROC % Historical Data

The historical data trend for Reven Housing REIT'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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Reven Housing REIT ROC % Chart

Reven Housing REIT Annual Data

Trend

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

ROC %

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-3.25

-2.08

-1.41

-0.27

-0.10

Reven Housing REIT Quarterly Data
	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19
ROC %	Get a 7-Day Free Trial															0.61	-0.60	-0.76	-0.24	-0.92

Reven Housing REIT ROC % Calculation

Reven Housing REIT's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2018 is calculated as:

	ROC % (A: Dec. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2017 )	+	Invested Capital (A: Dec. 2018 ))	/ count )
=	-0.065 * ( 1 - 0% )	/	( (58.915	+	74.625)	/ 2 )
=	-0.065	/	66.77
=	-0.10 %

where

	Invested Capital		(A: Dec. 2017 )
=	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	))
=	65.587	-	1.037	-	( 6.442	-	max(0, 1.453	-	7.088	+	6.442	))
=	58.915

	Invested Capital		(A: Dec. 2018 )
=	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	))
=	83.102	-	1.067	-	( 8.252	-	max(0, 1.573	-	8.983	+	8.252	))
=	74.625

Reven Housing REIT's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2019 is calculated as:

	ROC % (Q: Jun. 2019 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2019 )	+	Invested Capital (Q: Jun. 2019 ))	/ count )
=	-0.732 * ( 1 - 0% )	/	( (79.102	+	80.586)	/ 2 )
=	-0.732	/	79.844
=	-0.92 %

where

	Invested Capital		(Q: Mar. 2019 )
=	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	))
=	92.435	-	0.706	-	( 12.982	-	max(0, 1.222	-	13.849	+	12.982	))
=	79.102

	Invested Capital		(Q: Jun. 2019 )
=	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	))
=	92.999	-	2.091	-	( 11.997	-	max(0, 2.711	-	13.033	+	11.997	))
=	80.586

Note: The Operating Income data used here is four times the quarterly (Jun. 2019) data.

Reven Housing REIT (NAS:RVEN) 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, Reven Housing REIT's WACC % is 0.00%. Reven Housing REIT's ROC % is 0.00% (calculated using TTM income statement data). Reven Housing REIT 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.

Reven Housing REIT ROC % Related Terms

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Reven Housing REIT (Reven Housing REIT) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Reven Housing REIT Inc (NAS:RVEN) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

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Address

875 Prospect Street, Suite 304, La Jolla, CA, USA, 92037

Website

http://www.revenhousingreit.com

Reven Housing REIT Inc is a US-based company which engaged in the acquisition, ownership, and operation of portfolios of leased single-family homes (SFRs) in the United States. It operates its portfolio properties as single-family rentals generate revenues from rental income from the existing tenants of the SFRs acquired. The company owns nearly 600 single-family homes in the Houston, Jacksonville, Memphis and Atlanta metropolitan areas. Reven operates through the single segment of business being Operation of leased single-family homes. It earns the majority of its revenue from the United States.

Reven Housing REIT (Reven Housing REIT) Headlines

From GuruFocus

Reven Housing REIT, Inc. Declares Second Quarter 2019 Dividend

By PRNewswire PRNewswire • 04-17-2019

KBS Strategic Opportunity REIT, Inc. to Acquire Reven Housing REIT, Inc. for $56.85 Million in Equity Value

By PRNewswire PRNewswire • 08-31-2019

Reven Housing REIT, Inc. Announces Offering of 6.0% Series A Cumulative Convertible Redeemable Preferred Stock

By PRNewswire PRNewswire • 10-23-2019