ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Inpex's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2024 was 4.28%.
As of today (2024-12-12), Inpex's WACC % is 3.62%. Inpex's ROIC % is 5.41% (calculated using TTM income statement data).
Inpex 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.
Inpex ROIC % Historical Data
The historical data trend for Inpex'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 Oil & Gas E&P subindustry, Inpex'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.
Inpex's ROIC % Distribution in the Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Inpex's ROIC % distribution charts can be found below:
* The bar in red indicates where Inpex's ROIC % falls into.
Inpex ROIC % Calculation
Inpex's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (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.
Inpex (OTCPK:IPXHF) 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, Inpex's WACC % is 3.62%. Inpex's ROIC % is 5.41% (calculated using TTM income statement data).
Inpex 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.
Inpex 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.
Inpex ROIC % Related Terms
Thank you for viewing the detailed overview of Inpex's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Headquartered in Tokyo, Inpex was founded in 2008 through a merger with Teikoku Oil. The precursor Inpex began life in 1966 as North Sumatra Offshore Petroleum Exploration Co, and discovered the Attaka field in Indonesia in 1970 before acquiring the ADMA Block offshore the United Arab Emirates in 1977 and then discovering the Kashagan oil field in Kazakhstan, and Ichthys and Abadi gas fields in the Timor Sea in 2001. Teikoku Oil was founded in 1941 as a semigovernment entity and discovered Japan's largest natural gas reserves in Minami Nagaoka in 1979.Inpex is Japan's largest hydrocarbon producer, with oil and gas projects across multiple continents. It produces 230 million barrels of oil equivalent per year and has 6.2 billion barrels of oil equivalent in proven and probable reserves.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
IPXHF has been successfully added to your 