Ostin Technology Group Co (Ostin Technology Group Co) ROIC % : -18.17% (As of Sep. 2023)

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What is Ostin Technology Group 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 %. Ostin Technology Group Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2023 was -18.17%.

As of today (2024-05-16), Ostin Technology Group Co's WACC % is 6.46%. Ostin Technology Group Co's ROIC % is -18.11% (calculated using TTM income statement data). Ostin Technology Group Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ostin Technology Group Co ROIC % Historical Data

The historical data trend for Ostin Technology Group 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.

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Ostin Technology Group Co ROIC % Chart

Ostin Technology Group Co Annual Data

Trend

Sep19

Sep20

Sep21

Sep22

Sep23

ROIC %

2.95

10.62

6.59

0.54

-18.51

Ostin Technology Group Co Semi-Annual Data
	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
ROIC %	Get a 7-Day Free Trial				5.47	5.95	-3.96	-17.59	-18.17

Competitive Comparison of Ostin Technology Group Co's ROIC %

For the Electronic Components subindustry, Ostin Technology Group 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.

Ostin Technology Group Co's ROIC % Distribution in the Hardware Industry

For the Hardware industry and Technology sector, Ostin Technology Group Co's ROIC % distribution charts can be found below:

* The bar in red indicates where Ostin Technology Group Co's ROIC % falls into.

Ostin Technology Group Co ROIC % Calculation

Ostin Technology Group Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Sep. 2023 is calculated as:

	ROIC % (A: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2022 )	+	Invested Capital (A: Sep. 2023 ))	/ count )
=	-9.677 * ( 1 - -2.1% )	/	( (49.072	+	57.705)	/ 2 )
=	-9.880217	/	53.3885
=	-18.51 %

where

	Invested Capital		(A: Sep. 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	))
=	57.234	-	7.81	-	( 3.656	-	max(0, 31.556	-	31.908	+	3.656	))
=	49.072

	Invested Capital		(A: Sep. 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	))
=	56.549	-	14.937	-	( 0.855	-	max(0, 40.531	-	24.438	+	0.855	))
=	57.705

Ostin Technology Group Co's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2023 is calculated as:

	ROIC % (Q: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	-9.832 * ( 1 - -5.93% )	/	( (56.932	+	57.705)	/ 2 )
=	-10.4150376	/	57.3185
=	-18.17 %

where

	Invested Capital		(Q: Mar. 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	))
=	57.677	-	9.595	-	( 2.62	-	max(0, 37.151	-	28.301	+	2.62	))
=	56.932

	Invested Capital		(Q: Sep. 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	))
=	56.549	-	14.937	-	( 0.855	-	max(0, 40.531	-	24.438	+	0.855	))
=	57.705

Note: The Operating Income data used here is two times the semi-annual (Sep. 2023) data.

Ostin Technology Group Co (NAS:OST) 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, Ostin Technology Group Co's WACC % is 6.46%. Ostin Technology Group Co's ROIC % is -18.11% (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.

Ostin Technology Group Co ROIC % Related Terms

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Ostin Technology Group Co (Ostin Technology Group Co) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Ostin Technology Group Co Ltd (NAS:OST) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

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Address

1 Kechuang Road, Building 2, 101/201, Qixia District, Nanjing, CHN, 210046

Website

http://www.austinelec.com

Ostin Technology Group Co Ltd is a supplier of display modules and polarizers in China. It designs, develops, and manufactures TFT-LCD modules in a wide range of sizes and customized sizes according to the specifications of its customers. Its display modules are mainly used in consumer electronics, commercial LCD displays, and automotive displays. The company also manufactures polarizers used in the TFT-LCD display modules and is in the process of developing polarizers for the OLED display panel.