Aston Martin Lagonda Global Holdings (STU:A5SA) ROC % : -6.30% (As of Jun. 2024)

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What is Aston Martin Lagonda Global Holdings 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 %. Aston Martin Lagonda Global Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was -6.30%.

As of today (2024-12-14), Aston Martin Lagonda Global Holdings's WACC % is 12.13%. Aston Martin Lagonda Global Holdings's ROC % is -3.80% (calculated using TTM income statement data). Aston Martin Lagonda Global Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Aston Martin Lagonda Global Holdings ROC % Historical Data

The historical data trend for Aston Martin Lagonda Global Holdings'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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Aston Martin Lagonda Global Holdings ROC % Chart

Aston Martin Lagonda Global Holdings Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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0.45

-7.66

-2.86

-4.98

-2.58

Aston Martin Lagonda Global Holdings Quarterly Data
	Sep18	Dec18	Jun19	Sep19	Dec19	Jun20	Sep20	Dec20	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Dec23	Mar24	Jun24
ROC %	Get a 7-Day Free Trial															-6.51	-6.23	-	-7.62	-6.30

Aston Martin Lagonda Global Holdings ROC % Calculation

Aston Martin Lagonda Global Holdings'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 )
=	-92.513 * ( 1 - 5.42% )	/	( (3265.482	+	3506.19)	/ 2 )
=	-87.4987954	/	3385.836
=	-2.58 %

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	))
=	3569.378	-	225.019	-	( 632.974	-	max(0, 1215.127	-	1294.004	+	632.974	))
=	3265.482

	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	))
=	3683.09	-	170.632	-	( 455.482	-	max(0, 1144.625	-	1150.893	+	455.482	))
=	3506.19

Aston Martin Lagonda Global Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:

	ROC % (Q: Jun. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2024 )	+	Invested Capital (Q: Jun. 2024 ))	/ count )
=	-201.876 * ( 1 - 11.81% )	/	( (0	+	2825.649)	/ 1 )
=	-178.0344444	/	2825.649
=	-6.30 %

where

	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	))
=	0	-	0	-	( 0	-	max(0, 0	-	0	+	0	))
=	0

	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	))
=	3595.325	-	896.379	-	( 211.921	-	max(0, 1049.439	-	922.736	+	211.921	))
=	2825.649

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

Aston Martin Lagonda Global Holdings (STU:A5SA) 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, Aston Martin Lagonda Global Holdings's WACC % is 12.13%. Aston Martin Lagonda Global Holdings's ROC % is -3.80% (calculated using TTM income statement data). Aston Martin Lagonda Global Holdings 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.

Aston Martin Lagonda Global Holdings ROC % Related Terms

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Aston Martin Lagonda Global Holdings Business Description

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GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » Aston Martin Lagonda Global Holdings PLC (STU:A5SA) » Definitions » ROC %

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Address

Banbury Road, Gaydon, Warwick, GBR, CV35 0DB

Website

https://www.astonmartinlagonda.com

Aston Martin Lagonda Global Holdings PLC is a luxury automotive manufacturer. It designs, engineers, and produces sports cars in Warwickshire, United Kingdom, and sells those models through a network of dealers. It is also involved in the servicing of sports cars, all the activities are carried out under the brand name of Aston Martin. The Group has only one operating segment, the automotive segment. The automotive segment includes all activities relating to design, development, manufacture and marketing of vehicles including consulting services; as well as the sale of parts, servicing, and automotive brand activities. Geographically, it has a presence in the United Kingdom, The Americas, the Rest of Europe, the Middle East and Africa, and the Asia Pacific region.

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