Greenway Greenhouse Cannabis (XCNQ:GWAY) ROC % : -10.96% (As of Sep. 2024)

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What is Greenway Greenhouse Cannabis 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 %. Greenway Greenhouse Cannabis's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was -10.96%.

As of today (2024-12-13), Greenway Greenhouse Cannabis's WACC % is 5.15%. Greenway Greenhouse Cannabis's ROC % is -12.29% (calculated using TTM income statement data). Greenway Greenhouse Cannabis earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Greenway Greenhouse Cannabis ROC % Historical Data

The historical data trend for Greenway Greenhouse Cannabis'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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Greenway Greenhouse Cannabis ROC % Chart

Greenway Greenhouse Cannabis Annual Data

Trend

Mar21

Mar22

Mar23

Mar24

ROC %

-5.82

-5.57

-6.86

-12.52

Greenway Greenhouse Cannabis Quarterly Data
	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial												-6.37	-18.20	-15.93	-3.81	-10.96

Greenway Greenhouse Cannabis ROC % Calculation

Greenway Greenhouse Cannabis's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2024 is calculated as:

	ROC % (A: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2023 )	+	Invested Capital (A: Mar. 2024 ))	/ count )
=	-3.637 * ( 1 - 0% )	/	( (29.323	+	28.788)	/ 2 )
=	-3.637	/	29.0555
=	-12.52 %

where

	Invested Capital		(A: Mar. 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	))
=	35.305	-	6.401	-	( 3.642	-	max(0, 6.79	-	6.371	+	3.642	))
=	29.323

	Invested Capital		(A: 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	))
=	33.089	-	5.154	-	( 1.531	-	max(0, 5.527	-	4.674	+	1.531	))
=	28.788

Greenway Greenhouse Cannabis's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2024 is calculated as:

	ROC % (Q: Sep. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2024 )	+	Invested Capital (Q: Sep. 2024 ))	/ count )
=	-3.08 * ( 1 - 0% )	/	( (28.328	+	27.876)	/ 2 )
=	-3.08	/	28.102
=	-10.96 %

where

	Invested Capital		(Q: Jun. 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	))
=	32.695	-	5.307	-	( 1.566	-	max(0, 5.685	-	4.745	+	1.566	))
=	28.328

	Invested Capital		(Q: Sep. 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	))
=	32.047	-	5.76	-	( 2.256	-	max(0, 6.144	-	4.555	+	2.256	))
=	27.876

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

Greenway Greenhouse Cannabis (XCNQ:GWAY) 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, Greenway Greenhouse Cannabis's WACC % is 5.15%. Greenway Greenhouse Cannabis's ROC % is -12.29% (calculated using TTM income statement data). Greenway Greenhouse Cannabis 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.

Greenway Greenhouse Cannabis ROC % Related Terms

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Greenway Greenhouse Cannabis Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Greenway Greenhouse Cannabis Corp (XCNQ:GWAY) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

GWAYF:USA

Address

1478 Seacliff Drive, Kingsville, ON, CAN, N9Y 2M2

Website

https://www.greenway.ca

Greenway Greenhouse Cannabis Corp is licensed to cultivate, process and sell to ensures harvests always consist of the highest quality cannabis strains with resinous flowers, trichomes, and rich cannabinoid profiles. The Company's nursery facility is located in Kingsville, Ontario, and its flowering and processing facility is located in Leamington, Ontario. The business model is to supply bulk packaged, high quality cannabis to the Canadian, cannabis industry at prices that ultimately provide a value proposition to the consumers. Greenway has three divisions with various locations; Greenway Nursery, Greenway Cultivation and future plans for Greenway Farmgate Retail Store.

Executives

Darren Joseph Peddle

Director

Greenway Greenhouse Cannabis Headlines

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