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Espe SpA (MIL:ESPE) ROIC % : 6.27% (As of Jun. 2024)


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What is Espe SpA 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 %. Espe SpA's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2024 was 6.27%.

As of today (2024-10-31), Espe SpA's WACC % is 8.45%. Espe SpA's ROIC % is 5.89% (calculated using TTM income statement data). Espe SpA earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Espe SpA ROIC % Historical Data

The historical data trend for Espe SpA'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.

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Espe SpA ROIC % Chart

Espe SpA Annual Data
Trend Dec21 Dec22 Dec23
ROIC %
-0.09 1.89 5.25

Espe SpA Semi-Annual Data
Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
ROIC % Get a 7-Day Free Trial 0.44 2.75 7.08 5.66 6.27

Competitive Comparison of Espe SpA's ROIC %

For the Engineering & Construction subindustry, Espe SpA'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.


Espe SpA's ROIC % Distribution in the Construction Industry

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

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



Espe SpA ROIC % Calculation

Espe SpA's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2022 is calculated as:

ROIC % (A: Dec. 2022 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2021 ) + Invested Capital (A: Dec. 2022 ))/ count )
=0.68 * ( 1 - 39.4% )/( (15.304 + 28.273)/ 2 )
=0.41208/21.7885
=1.89 %

where

Espe SpA'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 )
=5.204 * ( 1 - 36.99% )/( (41.597 + 63.01)/ 2 )
=3.2790404/52.3035
=6.27 %

where

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.


Espe SpA  (MIL:ESPE) 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, Espe SpA's WACC % is 8.45%. Espe SpA's ROIC % is 5.89% (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.


Espe SpA ROIC % Related Terms

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Espe SpA Business Description

Comparable Companies
Traded in Other Exchanges
N/A
Address
Via Dell Artigianato 6, Grantorto, Padua, ITA, 35010
Espe SpA is a company which is producers of cutting edge solutions. They are born as installers of industrial electrical systems, over the years they have accumulated a rich wealth of experience, expanding its activities in the field of installation of photovoltaic systems and in the direct production of innovative technologies in the small wind, hydroelectric and biomass sectors.

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