ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Forge Group's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2013 was 39.39%.
As of today (2024-06-17), Forge Group's WACC % is 0.00%. Forge Group's ROIC % is 0.00% (calculated using TTM income statement data).
Forge Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Forge Group ROIC % Historical Data
The historical data trend for Forge Group's ROIC % 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.
For the Engineering & Construction subindustry, Forge Group's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Forge Group's ROIC % Distribution in the Construction Industry
For the Construction industry and Industrials sector, Forge Group's ROIC % distribution charts can be found below:
* The bar in red indicates where Forge Group's ROIC % falls into.
Forge Group ROIC % Calculation
Forge Group's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Jun. 2013 is calculated as:
Note:
The Operating Income data used here is one times the annual (Jun. 2013) 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.
Forge Group (ASX:FGE) ROIC % Explanation
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Forge Group's WACC % is 0.00%. Forge Group's ROIC % is 0.00% (calculated using TTM income statement data).
Be Aware
Like ROE % and ROA %, ROIC % 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.
Forge Group ROIC % Related Terms
Thank you for viewing the detailed overview of Forge Group's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Forge Group Ltd provides construction, commercial building, engineering, maintenance and workshop fabrication services. Its operations are segmented into four areas - Minerals & Resources, Power, Construction and Asset Management. The Minerals & Resources segment provides a wide range of engineering, design and construction services for the mining and metals sector. The Power segment provides turnkey power generation solutions to the energy and utilities sectors. The Construction segment offers a suite of construction services that covers all disciplines including heavy civil, structural, mechanical, piping, tanks, electrical, instrumentation, and building. Further, the Asset Management segment offers various asset management services. The Company has operational footprints across Australia, North America, Africa and Asia.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
ASX:FGE has been successfully added to your