Ameriwest Lithium (XCNQ:AWLI) ROC % : -10.08% (As of Jan. 2024)

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What is Ameriwest Lithium 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 %. Ameriwest Lithium's annualized return on capital (ROC %) for the quarter that ended in Jan. 2024 was -10.08%.

As of today (2024-04-30), Ameriwest Lithium's WACC % is 17.88%. Ameriwest Lithium's ROC % is -25.35% (calculated using TTM income statement data). Ameriwest Lithium earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ameriwest Lithium ROC % Historical Data

The historical data trend for Ameriwest Lithium'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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Ameriwest Lithium ROC % Chart

Ameriwest Lithium Annual Data

Trend

Apr19

Apr20

Apr21

Apr22

Apr23

ROC %

-65.60

-71.49

-108.83

-220.45

-54.29

Ameriwest Lithium Quarterly Data
	Apr19	Jul19	Oct19	Jan20	Apr20	Jul20	Oct20	Jan21	Apr21	Jul21	Oct21	Jan22	Apr22	Jul22	Oct22	Jan23	Apr23	Jul23	Oct23	Jan24
ROC %	Get a 7-Day Free Trial															-14.88	-30.30	-56.05	-7.80	-10.08

Ameriwest Lithium ROC % Calculation

Ameriwest Lithium's annualized Return on Capital (ROC %) for the fiscal year that ended in Apr. 2023 is calculated as:

	ROC % (A: Apr. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Apr. 2022 )	+	Invested Capital (A: Apr. 2023 ))	/ count )
=	-4.07 * ( 1 - 0% )	/	( (7.572	+	7.421)	/ 2 )
=	-4.07	/	7.4965
=	-54.29 %

where

	Invested Capital		(A: Apr. 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	))
=	12.048	-	0.653	-	( 4.431	-	max(0, 0.666	-	4.489	+	4.431	))
=	7.572

	Invested Capital		(A: Apr. 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	))
=	8.103	-	1.2	-	( 0.678	-	max(0, 1.206	-	0.688	+	0.678	))
=	7.421

Ameriwest Lithium's annualized Return on Capital (ROC %) for the quarter that ended in Jan. 2024 is calculated as:

	ROC % (Q: Jan. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Oct. 2023 )	+	Invested Capital (Q: Jan. 2024 ))	/ count )
=	-0.832 * ( 1 - 0% )	/	( (8.199	+	8.314)	/ 2 )
=	-0.832	/	8.2565
=	-10.08 %

where

	Invested Capital		(Q: Oct. 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	))
=	8.623	-	0.374	-	( 0.38	-	max(0, 0.374	-	0.424	+	0.38	))
=	8.199

	Invested Capital		(Q: Jan. 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	))
=	8.6	-	0.562	-	( 0.276	-	max(0, 0.588	-	0.312	+	0.276	))
=	8.314

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

Ameriwest Lithium (XCNQ:AWLI) 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, Ameriwest Lithium's WACC % is 17.88%. Ameriwest Lithium's ROC % is -25.35% (calculated using TTM income statement data). Ameriwest Lithium 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.

Ameriwest Lithium ROC % Related Terms

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Ameriwest Lithium (XCNQ:AWLI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » Ameriwest Lithium Inc (XCNQ:AWLI) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

AWLIF:USA 5HV0:Germany

Address

1110 Hamilton Street, Suite 306, Vancouver, BC, CAN, V6B 2S2

Website

https://www.ameriwestlithium.com

Ameriwest Lithium Inc is a junior mining company with a focus on identifying and evaluating mineral resource projects for further exploration and future development. The company portfolio includes Koster Dam Property, Canada; Thunderbird Property, Canada; Quet & Fire Property, Canada; ESN Property, USA; Deer Musk East Property, USA; Railroad Valley Property, USA; Edwards Creek Valley Property, USA and Thompson Valley Property, USA. The company operates in one reportable operating segment, the acquisition, exploration, and development of mineral properties. It operates in Canada and the United States.

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