Strauss Group (Strauss Group) ROC % : 7.87% (As of Dec. 2023)

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What is Strauss Group 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 %. Strauss Group's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 7.87%.

As of today (2024-05-01), Strauss Group's WACC % is 8.63%. Strauss Group's ROC % is 7.10% (calculated using TTM income statement data). Strauss Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Strauss Group ROC % Historical Data

The historical data trend for Strauss Group'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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Strauss Group ROC % Chart

Strauss Group Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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9.14

9.78

10.08

2.57

6.81

Strauss Group Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial															1.27	10.91	5.28	4.48	7.87

Strauss Group ROC % Calculation

Strauss Group'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 )
=	155.362 * ( 1 - 23.16% )	/	( (1715.939	+	1789.208)	/ 2 )
=	119.3801608	/	1752.5735
=	6.81 %

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	))
=	1982.007	-	353.777	-	( 138.248	-	max(0, 750.339	-	662.63	+	138.248	))
=	1715.939

	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	))
=	2184.7	-	384.261	-	( 138.248	-	max(0, 667.711	-	678.942	+	138.248	))
=	1789.208

Strauss Group's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	170.068 * ( 1 - 19.74% )	/	( (1677.968	+	1789.208)	/ 2 )
=	136.4965768	/	1733.588
=	7.87 %

where

	Invested Capital		(Q: 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	))
=	2195.129	-	506.198	-	( 116.054	-	max(0, 705.95	-	716.913	+	116.054	))
=	1677.968

	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	))
=	2184.7	-	384.261	-	( 138.248	-	max(0, 667.711	-	678.942	+	138.248	))
=	1789.208

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Strauss Group (GREY:SGLJY) 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, Strauss Group's WACC % is 8.63%. Strauss Group's ROC % is 7.10% (calculated using TTM income statement data). Strauss Group 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.

Strauss Group ROC % Related Terms

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Strauss Group (Strauss Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Strauss Group Ltd (GREY:SGLJY) » Definitions » ROC %

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STRS:Israel

Address

49 Hasivim Street, Kiryat Matalon, P.O. Box 194, Petach Tikva, ISR, 4959504

Website

https://www.strauss-group.com

Strauss Group Ltd is a food and beverage company that holds a portfolio of companies including Strauss Coffee B.V., which produces coffee, teas, and other complementary products, and provides coffee services to hotels, restaurants, cafes, and working places; Strauss Israel, which offers a variety of products such as dairies, snacks, and drinks to Israel food market; Strauss Water, which specializes in drinking water solutions; and PepsiCo-Strauss Fresh Dips and Spreads, which supplies vegetarian dips and fresh foods. Its geographical segments are Israel, and Europe and the Rest of the World, of which the company generates most of its revenue from Israel.