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XCHG (XCH) ROC % : 18.86% (As of Mar. 2024)


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What is XCHG 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 %. XCHG's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 18.86%.

As of today (2024-12-14), XCHG's WACC % is 8.16%. XCHG's ROC % is -29.34% (calculated using TTM income statement data). XCHG earns returns that do not match up to its cost of capital. It will destroy value as it grows.

XCHG ROC % Historical Data

The historical data trend for XCHG'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.

XCHG ROC % Chart

XCHG Annual Data
Trend Dec21 Dec22 Dec23
ROC %
-15.54 16.37 -39.62

XCHG Quarterly Data
Dec21 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
ROC % Get a 7-Day Free Trial Premium Member Only 2.30 72.95 -174.27 -28.46 18.86

XCHG ROC % Calculation

XCHG'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 )
=-6.377 * ( 1 - 0% )/( (10.76 + 21.432)/ 2 )
=-6.377/16.096
=-39.62 %

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))
=29.139 - 10.041 - ( 8.338 - max(0, 17.993 - 28.183+8.338))
=10.76

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))
=40.96 - 10.511 - ( 15.661 - max(0, 30.728 - 39.745+15.661))
=21.432

XCHG'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 )
=3.96 * ( 1 - 1.48% )/( (21.432 + 19.938)/ 2 )
=3.901392/20.685
=18.86 %

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))
=40.96 - 10.511 - ( 15.661 - max(0, 30.728 - 39.745+15.661))
=21.432

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))
=41.775 - 9.056 - ( 12.781 - max(0, 21.055 - 40.426+12.781))
=19.938

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

* 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.

XCHG  (NAS:XCH) 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, XCHG's WACC % is 8.16%. XCHG's ROC % is -29.34% (calculated using TTM income statement data). XCHG 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.

XCHG ROC % Related Terms

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XCHG Business Description

Industry
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Address
Hamburg-Mitte Grevenweg 24, Hamburg, DEU, 20537
Website
https://www.xcharge.com
XCHG Ltd engaged in designing, manufacturing and selling of Electric Vehicle (EV) chargers and EV charging solutions which include the DC fast chargers named the C6 series and the C7 series, the battery-integrated DC fast chargers which is Net Zero Series (NZS), as well as accompanying services. Its integrated solution combining proprietary charging technology, energy storage technology and accompanying services significantly improves EV charging efficiency and unlocks the value of energy storage and management. Its NZS solution enables fast charging at low power locations or vis-a-vis aged grid infrastructures (which typically are not compatible with fast charging equipment) with no site improvements or grid upgrades needed.