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EXPO (Exponent) ROIC % : 18.78% (As of Sep. 2024)


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What is Exponent ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Exponent's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 18.78%.

As of today (2024-12-13), Exponent's WACC % is 9.21%. Exponent's ROIC % is 21.69% (calculated using TTM income statement data). Exponent generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.


Exponent ROIC % Historical Data

The historical data trend for Exponent'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.

* Premium members only.

Exponent ROIC % Chart

Exponent Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROIC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 33.87 30.20 34.32 38.39 25.71

Exponent Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
ROIC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 27.95 14.82 25.90 27.66 18.78

Competitive Comparison of Exponent's ROIC %

For the Engineering & Construction subindustry, Exponent'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.


Exponent's ROIC % Distribution in the Construction Industry

For the Construction industry and Industrials sector, Exponent's ROIC % distribution charts can be found below:

* The bar in red indicates where Exponent's ROIC % falls into.



Exponent ROIC % Calculation

Exponent's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

ROIC % (A: Dec. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2022 ) + Invested Capital (A: Dec. 2023 ))/ count )
=111.322 * ( 1 - 26.16% )/( (300.438 + 338.895)/ 2 )
=82.2001648/319.6665
=25.71 %

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))
=586.662 - 124.766 - ( 161.458 - max(0, 159.029 - 349.157+161.458))
=300.438

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))
=646.777 - 120.732 - ( 187.15 - max(0, 161.909 - 379.532+187.15))
=338.895

Exponent's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2024 is calculated as:

ROIC % (Q: Sep. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Jun. 2024 ) + Invested Capital (Q: Sep. 2024 ))/ count )
=103.388 * ( 1 - 27.53% )/( (392.769 + 404.973)/ 2 )
=74.9252836/398.871
=18.78 %

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))
=709.177 - 113.146 - ( 203.262 - max(0, 131.824 - 391.327+203.262))
=392.769

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))
=744.065 - 119.384 - ( 219.708 - max(0, 137.738 - 412.581+219.708))
=404.973

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


Exponent  (NAS:EXPO) 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, Exponent's WACC % is 9.21%. Exponent's ROIC % is 21.69% (calculated using TTM income statement data). Exponent generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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. Exponent 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 %, 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.


Exponent ROIC % Related Terms

Thank you for viewing the detailed overview of Exponent's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.


Exponent Business Description

Traded in Other Exchanges
Address
149 Commonwealth Drive, Menlo Park, CA, USA, 94025
Exponent Inc provides engineering and scientific consulting services on a project-by-project basis. The company's consultant team is composed of scientists, physicians, engineers, as well as business and regulatory consultants. The company currently operates through two segments. The engineering and other scientific segments, which accounts for the majority of revenue, provides servicing encompassing biomechanics, biomedical engineering, buildings and structures, civil engineering, construction consulting, etc. The environmental and health segment covers chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences and others. The company generates almost all of its revenues from America.
Executives
Paul R Johnston officer: Chief Operating Officer EXPONENT INC, 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Carol Lindstrom director 5994 SILVERADO TRAIL, NAPA CA 94558
Richard Reiss officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Schlenker Richard L Jr officer: Chief Financial Officer EPONENT INC, 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
John Pye officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Eric Guyer officer: Group Vice Presient 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Bradley A James officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Joseph Rakow officer: Group Vice President 149 COMMONWEATH DRIVE, MENLO PARK CA 94025
Reitman Maureen T. F. officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Steven J Murray officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Harri Kytomaa officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Sally Shepard officer: VP, Human Resources 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
George H. Brown director 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
John Joseph Doyle officer: Group Vice President 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025
Debra Zumwalt director 149 COMMONWEALTH DRIVE, MENLO PARK CA 94025