ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Eastern Technical Engineering PCL's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was 4.57%.
As of today (2024-05-26), Eastern Technical Engineering PCL's WACC % is 8.82%. Eastern Technical Engineering PCL's ROIC % is 4.25% (calculated using TTM income statement data).
Eastern Technical Engineering PCL earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Eastern Technical Engineering PCL ROIC % Historical 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.
Competitive Comparison of Eastern Technical Engineering PCL's ROIC %
For the Conglomerates subindustry, Eastern Technical Engineering PCL'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.
Eastern Technical Engineering PCL's ROIC % Distribution in the Conglomerates Industry
For the Conglomerates industry and Industrials sector, Eastern Technical Engineering PCL's ROIC % distribution charts can be found below:
* The bar in red indicates where Eastern Technical Engineering PCL's ROIC % falls into.
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.
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, Eastern Technical Engineering PCL's WACC % is 8.82%. Eastern Technical Engineering PCL's ROIC % is 4.25% (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.
Eastern Technical Engineering PCL ROIC % Related Terms
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Eastern Technical Engineering PCL (BKK:ETE) Business Description
Eastern Technical Engineering PCL is engaged in operating management service, installation service of electricity transmission network, telecommunication network, power generation from renewable energy and sale of goods and other service. The company's segments include Business of Management Service; Business of Construction Service; Business of renewable energy; and Business of sale of goods and other services. It derives majority of the revenue from Business of Management Service. All of its operations are carried out in Thailand.
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