Alargan International Real Estate Co (KUW:ARGAN) ROIC % : 0.10% (As of Sep. 2024)

View and export this data going back to 2007. Start your Free Trial

What is Alargan International Real Estate Co 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 %. Alargan International Real Estate Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 0.10%.

As of today (2024-12-11), Alargan International Real Estate Co's WACC % is 5.43%. Alargan International Real Estate Co's ROIC % is -0.33% (calculated using TTM income statement data). Alargan International Real Estate Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Alargan International Real Estate Co ROIC % Historical Data

The historical data trend for Alargan International Real Estate Co'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.

Alargan International Real Estate Co ROIC % Chart

Alargan International Real Estate Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROIC %

Get a 7-Day Free Trial

1.60

-1.28

0.69

-0.70

-0.27

Alargan International Real Estate Co 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															0.50	-2.06	-0.26	0.79	0.10

Competitive Comparison of Alargan International Real Estate Co's ROIC %

For the Real Estate Services subindustry, Alargan International Real Estate Co'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.

Alargan International Real Estate Co's ROIC % Distribution in the Real Estate Industry

For the Real Estate industry and Real Estate sector, Alargan International Real Estate Co's ROIC % distribution charts can be found below:

* The bar in red indicates where Alargan International Real Estate Co's ROIC % falls into.

Alargan International Real Estate Co ROIC % Calculation

Alargan International Real Estate Co'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 )
=	-0.681 * ( 1 - 4.57% )	/	( (228.746	+	244.309)	/ 2 )
=	-0.6498783	/	236.5275
=	-0.27 %

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	))
=	237.106	-	5.602	-	( 2.758	-	max(0, 33.958	-	39.132	+	2.758	))
=	228.746

	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	))
=	254.851	-	8.115	-	( 2.427	-	max(0, 34.912	-	39.488	+	2.427	))
=	244.309

Alargan International Real Estate Co'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 )
=	0.236 * ( 1 - 0% )	/	( (245.4	+	246.399)	/ 2 )
=	0.236	/	245.8995
=	0.10 %

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	))
=	257.07	-	10.592	-	( 1.287	-	max(0, 39.738	-	40.816	+	1.287	))
=	245.4

	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	))
=	258.24	-	11.25	-	( 1.803	-	max(0, 40.858	-	41.449	+	1.803	))
=	246.399

Note: The Operating Income data used here is four times the quarterly (Sep. 2024) data.

Alargan International Real Estate Co (KUW:ARGAN) 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, Alargan International Real Estate Co's WACC % is 5.43%. Alargan International Real Estate Co's ROIC % is -0.33% (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.

Alargan International Real Estate Co ROIC % Related Terms

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

Alargan International Real Estate Co Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Alargan International Real Estate Co (KUW:ARGAN) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Free Trade Zone, Argan Business Park, P.O.Box 8904, Shuwaikh (Block F98), Kuwait City, KWT, 22060

Website

http://www.alargan.com

Alargan International Real Estate Co is a real estate company in Kuwait. Its activities are represented primarily in real estate investment activity, contracting activities and hotels and resorts activities. Its operating segments include Real estate investment, Contracting, Hotels, and resorts. The group primarily operates inside Kuwait and outside Kuwait which includes the Kingdom of Saudi Arabia, Kingdom of Bahrain, Arab Republic of Egypt, Sultanate of Oman, and the Republic of Lebanon. Geographically the company receives maximum revenue from inside Kuwait.

Alargan International Real Estate Co Headlines

No Headlines