Naqi Water Co (SAU:2282) ROC % : 18.11% (As of Sep. 2024)

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What is Naqi Water Co 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 %. Naqi Water Co's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was 18.11%.

As of today (2024-12-12), Naqi Water Co's WACC % is 10.17%. Naqi Water Co's ROC % is 12.67% (calculated using TTM income statement data). Naqi Water Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Naqi Water Co ROC % Historical Data

The historical data trend for Naqi Water Co'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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Naqi Water Co ROC % Chart

Naqi Water Co Annual Data

Trend

Dec21

Dec22

Dec23

ROC %

40.25

27.11

20.89

Naqi Water Co Quarterly Data
	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial								32.72	4.01	14.58	13.84	18.11

Naqi Water Co ROC % Calculation

Naqi Water Co's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	42.986 * ( 1 - 6.59% )	/	( (186.865	+	197.544)	/ 2 )
=	40.1532226	/	192.2045
=	20.89 %

where

	Invested Capital		(A: Dec. 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	))
=	291.115	-	16.193	-	( 88.057	-	max(0, 27.907	-	139.421	+	88.057	))
=	186.865

	Invested Capital		(A: 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	))
=	292.503	-	16.162	-	( 78.797	-	max(0, 27.759	-	135.662	+	78.797	))
=	197.544

Naqi Water Co's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2024 is calculated as:

	ROC % (Q: Sep. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2024 )	+	Invested Capital (Q: Sep. 2024 ))	/ count )
=	38.444 * ( 1 - 7.35% )	/	( (191.863	+	201.526)	/ 2 )
=	35.618366	/	196.6945
=	18.11 %

where

	Invested Capital		(Q: Jun. 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	))
=	303.765	-	19.329	-	( 92.573	-	max(0, 31.205	-	159.24	+	92.573	))
=	191.863

	Invested Capital		(Q: Sep. 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	))
=	316.475	-	21.403	-	( 93.546	-	max(0, 33.879	-	153.199	+	93.546	))
=	201.526

Note: The Operating Income data used here is four times the quarterly (Sep. 2024) data.

Naqi Water Co (SAU:2282) 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, Naqi Water Co's WACC % is 10.17%. Naqi Water Co's ROC % is 12.67% (calculated using TTM income statement data). Naqi Water Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

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.

Naqi Water Co ROC % Related Terms

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Naqi Water Co Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Beverages - Non-Alcoholic » Naqi Water Co (SAU:2282) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Al Absah District, P.O. Box 5228, Qassim, Unaizah, SAU, 56226-6812

Website

https://www.naqiwater.com

Naqi Water Co engages in the production and bottling of pure filtered water, the wholesale of all kinds of bottled water, the wholesale of soft drinks and juices, and the retail sale of beverages in Specialized stores, land transportation of goods. and rearing and producing broiler breeder hens, operating their hatcheries, and producing eggs. The segments of the company are Local Sales Water, Export Sales Water, Logistic Sales, and Egg Sales. The company generates maximum revenue from Central Saudi region.

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