Trinity Industries (STU:TTA) ROC % : 4.05% (As of Mar. 2024)

View and export this data going back to 2013. Start your Free Trial

What is Trinity Industries 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 %. Trinity Industries's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 4.05%.

As of today (2024-05-20), Trinity Industries's WACC % is 6.81%. Trinity Industries's ROC % is 3.88% (calculated using TTM income statement data). Trinity Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Trinity Industries ROC % Historical Data

The historical data trend for Trinity Industries'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.

* Premium members only.

Trinity Industries ROC % Chart

Trinity Industries Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

Get a 7-Day Free Trial

3.20

0.46

1.66

1.88

3.70

Trinity Industries Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial															8.27	2.46	3.69	4.94	4.05

Trinity Industries ROC % Calculation

Trinity Industries'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 )
=	298.208 * ( 1 - 6.04% )	/	( (7642.813	+	7513.164)	/ 2 )
=	280.1962368	/	7577.9885
=	3.70 %

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	))
=	8235.739	-	517.784	-	( 75.142	-	max(0, 517.784	-	1184.72	+	75.142	))
=	7642.813

	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	))
=	8167.26	-	557.169	-	( 96.927	-	max(0, 557.169	-	1181.188	+	96.927	))
=	7513.164

Trinity Industries's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	413.632 * ( 1 - 25.76% )	/	( (7513.164	+	7633.056)	/ 2 )
=	307.0803968	/	7573.11
=	4.05 %

where

	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	))
=	8167.26	-	557.169	-	( 96.927	-	max(0, 557.169	-	1181.188	+	96.927	))
=	7513.164

	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	))
=	8353.416	-	611.064	-	( 109.296	-	max(0, 611.064	-	1257.732	+	109.296	))
=	7633.056

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

Trinity Industries (STU:TTA) 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, Trinity Industries's WACC % is 6.81%. Trinity Industries's ROC % is 3.88% (calculated using TTM income statement data). Trinity Industries 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.

Trinity Industries ROC % Related Terms

Thank you for viewing the detailed overview of Trinity Industries's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.

Trinity Industries (STU:TTA) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Transportation » Trinity Industries Inc (STU:TTA) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

TRN:USA TTA:Germany

Address

14221 N. Dallas Parkway, Suite 1100, Dallas, TX, USA, 75254-2957

Website

https://www.trin.net

Trinity Industries Inc. sells and leases railroad products and railcar maintenance services in North America. The company operates under the name TrinityRail in three main segments: railcar leasing and management services, which owns railcars and provides fleet management and administration services; rail products, which builds, sells, and modifies freight and tank railcars and their components; and all other, which sells highway products such as guardrail and other highway barriers. Customers include railroads, leasing companies, and shipping companies in the industries of agriculture, construction, consumer products, energy, and chemicals.

Trinity Industries (STU:TTA) Headlines

No Headlines