TCOPJ.PFD (Taubman Centers) ROC % : 2.30% (As of Sep. 2020)

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What is Taubman Centers 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 %. Taubman Centers's annualized return on capital (ROC %) for the quarter that ended in Sep. 2020 was 2.30%.

As of today (2025-04-01), Taubman Centers's WACC % is 5.29%. Taubman Centers's ROC % is 2.64% (calculated using TTM income statement data). Taubman Centers earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Taubman Centers ROC % Historical Data

The historical data trend for Taubman Centers'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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Taubman Centers ROC % Chart

Taubman Centers Annual Data

Trend

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

ROC %

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6.37

5.17

3.67

4.02

4.67

Taubman Centers Quarterly Data
	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20
ROC %	Get a 7-Day Free Trial															3.30	4.05	1.68	0.11	2.30

Taubman Centers ROC % Calculation

Taubman Centers's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2019 is calculated as:

	ROC % (A: Dec. 2019 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2018 )	+	Invested Capital (A: Dec. 2019 ))	/ count )
=	165.168 * ( 1 - -20.06% )	/	( (4198.419	+	4296.915)	/ 2 )
=	198.3007008	/	4247.667
=	4.67 %

where

	Invested Capital		(A: Dec. 2018 )
=	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	))
=	4344.106	-	336.208	-	( 48.372	-	max(0, 336.208	-	145.687	+	48.372	))
=	4198.419

	Invested Capital		(A: Dec. 2019 )
=	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	))
=	4515.465	-	268.714	-	( 102.762	-	max(0, 268.714	-	218.55	+	102.762	))
=	4296.915

Taubman Centers's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2020 is calculated as:

	ROC % (Q: Sep. 2020 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2020 )	+	Invested Capital (Q: Sep. 2020 ))	/ count )
=	95.752 * ( 1 - -0.14% )	/	( (4180.415	+	4146.488)	/ 2 )
=	95.8860528	/	4163.4515
=	2.30 %

where

	Invested Capital		(Q: Jun. 2020 )
=	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	))
=	4591.434	-	254.228	-	( 240.808	-	max(0, 254.228	-	411.019	+	240.808	))
=	4180.415

	Invested Capital		(Q: Sep. 2020 )
=	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	))
=	4579.59	-	278.055	-	( 256.512	-	max(0, 278.055	-	433.102	+	256.512	))
=	4146.488

Note: The Operating Income data used here is four times the quarterly (Sep. 2020) data.

Taubman Centers (NYSE:TCOpJ.PFD) 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, Taubman Centers's WACC % is 5.29%. Taubman Centers's ROC % is 2.64% (calculated using TTM income statement data). Taubman Centers 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.

Taubman Centers ROC % Related Terms

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Taubman Centers Business Description

Industry

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Address

200 East Long Lake Road, Suite 300, Bloomfield Hills, MI, USA, 48304-2324

Website

http://www.taubman.com

Taubman Centers Inc is engaged in the ownership, leasing, acquisition, disposition, development, expansion, and management of shopping centers. The company owns or operates a collection of over 20 urban and suburban shopping centers in U.S. states, Puerto Rico, South Korea, and China. Some of the operating malls of the group are Cherry Creek Shopping center, City Creek Center, Dolphin Mall, Fair Oaks Mall, and Stamford Town Center. Taubman derives its revenue by offering its properties on lease.