ShenZhen Consys Science & Technology Co (SHSE:688788) ROC % : -15.81% (As of Sep. 2024)

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What is ShenZhen Consys Science & Technology 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 %. ShenZhen Consys Science & Technology Co's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was -15.81%.

As of today (2024-12-13), ShenZhen Consys Science & Technology Co's WACC % is 11.99%. ShenZhen Consys Science & Technology Co's ROC % is -18.45% (calculated using TTM income statement data). ShenZhen Consys Science & Technology Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

ShenZhen Consys Science & Technology Co ROC % Historical Data

The historical data trend for ShenZhen Consys Science & Technology 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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ShenZhen Consys Science & Technology Co ROC % Chart

ShenZhen Consys Science & Technology Co Annual Data

Trend

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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42.40

18.49

13.87

-10.13

-17.84

ShenZhen Consys Science & Technology Co Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial															-22.53	-17.18	-27.69	-14.35	-15.81

ShenZhen Consys Science & Technology Co ROC % Calculation

ShenZhen Consys Science & Technology 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 )
=	-212.64 * ( 1 - 2.24% )	/	( (1191.367	+	1139.551)	/ 2 )
=	-207.876864	/	1165.459
=	-17.84 %

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	))
=	2842.852	-	113.346	-	( 1538.139	-	max(0, 134.55	-	2677.436	+	1538.139	))
=	1191.367

	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	))
=	2572.19	-	93.181	-	( 1339.458	-	max(0, 121.656	-	2444.157	+	1339.458	))
=	1139.551

ShenZhen Consys Science & Technology 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 )
=	-172.34 * ( 1 - 4.88% )	/	( (1026.476	+	1047.409)	/ 2 )
=	-163.929808	/	1036.9425
=	-15.81 %

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	))
=	2441.701	-	111.622	-	( 1303.603	-	max(0, 142.001	-	2317.939	+	1303.603	))
=	1026.476

	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	))
=	2379.773	-	120.707	-	( 1211.657	-	max(0, 138.109	-	2252.478	+	1211.657	))
=	1047.409

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

ShenZhen Consys Science & Technology Co (SHSE:688788) 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, ShenZhen Consys Science & Technology Co's WACC % is 11.99%. ShenZhen Consys Science & Technology Co's ROC % is -18.45% (calculated using TTM income statement data). ShenZhen Consys Science & Technology Co 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.

ShenZhen Consys Science & Technology Co ROC % Related Terms

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ShenZhen Consys Science & Technology Co Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Aerospace & Defense » ShenZhen Consys Science & Technology Co Ltd (SHSE:688788) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

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Address

No. 7 Langshan Road, Xili Street, 5th Floor, Avionics Engineering R&D Building, Gaoxin North District, Nanshan District, Guangdong Province, Shenzhen, CHN, 518057

Website

http://www.consys.com.cn

ShenZhen Consys Science & Technology Co Ltd is engaged in research, development, manufacturing and sales of military electronic information equipment and related modules. The company provides modules, equipment to The systematic research and development capabilities of military electronic information equipment products serve various national defense and military customers.

Executives

Liang Hong Jian

Core technical personnel

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