GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Gaush Meditech Ltd (HKSE:02407) » Definitions » ROIC %

Gaush Meditech (HKSE:02407) ROIC % : 3.47% (As of Jun. 2024)


View and export this data going back to 2022. Start your Free Trial

What is Gaush Meditech 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 %. Gaush Meditech's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2024 was 3.47%.

As of today (2024-12-14), Gaush Meditech's WACC % is 8.13%. Gaush Meditech's ROIC % is 5.62% (calculated using TTM income statement data). Gaush Meditech earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Gaush Meditech ROIC % Historical Data

The historical data trend for Gaush Meditech'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.

Gaush Meditech ROIC % Chart

Gaush Meditech Annual Data
Trend Dec19 Dec20 Dec21 Dec22 Dec23
ROIC %
-1,358.32 9.75 19.28 19.63 10.12

Gaush Meditech Semi-Annual Data
Dec19 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
ROIC % Get a 7-Day Free Trial Premium Member Only 22.05 22.27 11.74 7.42 3.47

Competitive Comparison of Gaush Meditech's ROIC %

For the Medical Devices subindustry, Gaush Meditech'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.


Gaush Meditech's ROIC % Distribution in the Medical Devices & Instruments Industry

For the Medical Devices & Instruments industry and Healthcare sector, Gaush Meditech's ROIC % distribution charts can be found below:

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



Gaush Meditech ROIC % Calculation

Gaush Meditech'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 )
=305.334 * ( 1 - 30.2% )/( (1896.71 + 2314.364)/ 2 )
=213.123132/2105.537
=10.12 %

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))
=3035.331 - 229.439 - ( 909.182 - max(0, 550.119 - 1481.137+909.182))
=1896.71

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))
=3110.398 - 250.054 - ( 911.159 - max(0, 975.287 - 1521.267+911.159))
=2314.364

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

ROIC % (Q: Jun. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Dec. 2023 ) + Invested Capital (Q: Jun. 2024 ))/ count )
=159.608 * ( 1 - 53.89% )/( (2314.364 + 1921.338)/ 2 )
=73.5952488/2117.851
=3.47 %

where

Invested Capital(Q: 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))
=3110.398 - 250.054 - ( 911.159 - max(0, 975.287 - 1521.267+911.159))
=2314.364

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))
=3022.688 - 405.316 - ( 811.926 - max(0, 796.724 - 1492.758+811.926))
=1921.338

Note: The Operating Income data used here is two times the semi-annual (Jun. 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.


Gaush Meditech  (HKSE:02407) 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, Gaush Meditech's WACC % is 8.13%. Gaush Meditech's ROIC % is 5.62% (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.


Gaush Meditech ROIC % Related Terms

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


Gaush Meditech Business Description

Traded in Other Exchanges
N/A
Address
No.11 Dongzhimen South Avenue, Room 1901, Building A, Zhonghui Plaza, Dongcheng District, Beijing, CHN
Gaush Meditech Ltd is a provider of a broad spectrum of ophthalmic medical devices. The segments of the company include 1) Proprietary products segment develops and produces surgical equipment and related supporting software, intra-optical lens, ophthalmic disease diagnosis and treatment equipment and related supporting consumables independently; 2) Distribution products segment sells multi-function diagnostic equipment, ocular fundus diagnosis, surgical and treatment equipment and related supporting consumables produced by ophthalmic medical equipment manufacturers; 3) Technical services segment provides warranty services, maintenance services and after-sales services related consumables; and 4) Others segment.
Executives
Orbimed Advisors Iii Limited 2102 Investment manager
Orbimed Asia Gp Iii, L.p. 2102 Investment manager
Orbimed Asia Partners Iii, L.p. 2102 Investment manager
Gao Tieta 2201 Interest of corporation controlled by you
Gaush Holding Ltd 2101 Beneficial owner
Cuprite Gem Investments Ltd 2101 Beneficial owner
Warburg Pincus (bermuda) Private Equity Gp Ltd. 2201 Interest of corporation controlled by you
Warburg Pincus (cayman) China-southeast Asia Ii Gp Llc 2201 Interest of corporation controlled by you
Warburg Pincus (cayman) China-southeast Asia Ii Gp, L.p. 2201 Interest of corporation controlled by you
Warburg Pincus China-southeast Asia Ii (cayman), L.p. 2201 Interest of corporation controlled by you
Warburg Pincus Partners Ii (cayman), L.p. 2201 Interest of corporation controlled by you

Gaush Meditech Headlines

No Headlines