Wishpond Technologies (TSXV:WISH) ROC % : -8.21% (As of Mar. 2024)

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What is Wishpond Technologies 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 %. Wishpond Technologies's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -8.21%.

As of today (2024-06-18), Wishpond Technologies's WACC % is 6.41%. Wishpond Technologies's ROC % is -8.05% (calculated using TTM income statement data). Wishpond Technologies earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Wishpond Technologies ROC % Historical Data

The historical data trend for Wishpond Technologies'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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Wishpond Technologies ROC % Chart

Wishpond Technologies Annual Data

Trend

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

-5.07

-0.03

-31.39

-8.71

-9.57

Wishpond Technologies Quarterly Data
	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														-16.99	-15.65	12.07	-20.79	-8.21

Wishpond Technologies ROC % Calculation

Wishpond Technologies'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 )
=	-1.444 * ( 1 - -5.06% )	/	( (16.213	+	15.491)	/ 2 )
=	-1.5170664	/	15.852
=	-9.57 %

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	))
=	16.278	-	2.275	-	( 2.965	-	max(0, 5.666	-	3.456	+	2.965	))
=	16.213

	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	))
=	14.469	-	2.333	-	( 1.425	-	max(0, 5.153	-	1.798	+	1.425	))
=	15.491

Wishpond Technologies'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 )
=	-1.3 * ( 1 - 0% )	/	( (15.491	+	16.183)	/ 2 )
=	-1.3	/	15.837
=	-8.21 %

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	))
=	14.469	-	2.333	-	( 1.425	-	max(0, 5.153	-	1.798	+	1.425	))
=	15.491

	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	))
=	15.066	-	2.344	-	( 2.087	-	max(0, 6.005	-	2.544	+	2.087	))
=	16.183

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

Wishpond Technologies (TSXV:WISH) 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, Wishpond Technologies's WACC % is 6.41%. Wishpond Technologies's ROC % is -8.05% (calculated using TTM income statement data). Wishpond Technologies 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.

Wishpond Technologies ROC % Related Terms

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Wishpond Technologies (TSXV:WISH) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Wishpond Technologies Ltd (TSXV:WISH) » Definitions » ROC %

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Traded in Other Exchanges

WPNDF:USA

Address

422 Richards Street, No.170, Vancouver, BC, CAN, V6B 2Z4

Website

https://www.wishpond.com

Wishpond Technologies Ltd is a provider of marketing-focused online business solutions providing digital marketing solutions that empower entrepreneurs to achieve success online. The company offers an all-in-one marketing suite that provides companies with marketing, promotion, lead generation, sales automation, ad management, referral marketing, and sales conversion capabilities from one integrated platform. It replaces entire marketing functions in an easy-to-use product, for a fraction of the cost. It serves over 3,700 customers who are mainly small-to-medium size businesses in a wide variety of industries. The company employs a Software-as-a-Service (SaaS) business model where substantially all its revenue is subscription-based recurring revenue.

Executives

David Pais

Senior Officer

Wishpond Technologies (TSXV:WISH) Headlines

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