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LICY (Li-Cycle Holdings) ROIC % : -12.49% (As of Sep. 2024)


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What is Li-Cycle Holdings 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 %. Li-Cycle Holdings's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was -12.49%.

As of today (2024-12-14), Li-Cycle Holdings's WACC % is 11.80%. Li-Cycle Holdings's ROIC % is -17.49% (calculated using TTM income statement data). Li-Cycle Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Li-Cycle Holdings ROIC % Historical Data

The historical data trend for Li-Cycle Holdings'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.

Li-Cycle Holdings ROIC % Chart

Li-Cycle Holdings Annual Data
Trend Oct19 Oct20 Oct21 Oct22 Dec23
ROIC %
- -73.58 -89.76 -69.47 -31.56

Li-Cycle Holdings Quarterly Data
Oct19 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 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 -32.86 -19.86 -23.61 -13.71 -12.49

Competitive Comparison of Li-Cycle Holdings's ROIC %

For the Waste Management subindustry, Li-Cycle Holdings'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.


Li-Cycle Holdings's ROIC % Distribution in the Waste Management Industry

For the Waste Management industry and Industrials sector, Li-Cycle Holdings's ROIC % distribution charts can be found below:

* The bar in red indicates where Li-Cycle Holdings's ROIC % falls into.



Li-Cycle Holdings ROIC % Calculation

Li-Cycle Holdings'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: Oct. 2022 ) + Invested Capital (A: Dec. 2023 ))/ count )
=-158.6 * ( 1 - -0.07% )/( (264.2 + 741.6)/ 2 )
=-158.71102/502.9
=-31.56 %

where

Li-Cycle Holdings'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 )
=-100.8 * ( 1 - 0% )/( (812.9 + 801.8)/ 2 )
=-100.8/807.35
=-12.49 %

where

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.


Li-Cycle Holdings  (NYSE:LICY) 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, Li-Cycle Holdings's WACC % is 11.80%. Li-Cycle Holdings's ROIC % is -17.49% (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.


Li-Cycle Holdings ROIC % Related Terms

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Li-Cycle Holdings Business Description

Traded in Other Exchanges
N/A
Address
207 Queen’s Quay West, Suite 590, Toronto, ON, CAN, M5J 1A7
Li-Cycle Holdings Corp is a lithium-ion battery resource recovery and lithium-ion battery recycler. The company's proprietary process Spoke and Hub recycling process is designed at its Spokes, to process battery manufacturing scrap and end-of-life batteries to produce black mass and other intermediate products, and at its Hubs, to process black mass to recover raw materials, including but not limited to lithium carbonate, cobalt sulphate, and nickel sulphate.