8Telecom International Holdings Co (SGX:AZG) ROIC % : -3.72% (As of Sep. 2019)

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What is 8Telecom International Holdings 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 %. 8Telecom International Holdings Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2019 was -3.72%.

As of today (2024-05-21), 8Telecom International Holdings Co's WACC % is 0.00%. 8Telecom International Holdings Co's ROIC % is 0.00% (calculated using TTM income statement data). 8Telecom International Holdings Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

8Telecom International Holdings Co ROIC % Historical Data

The historical data trend for 8Telecom International Holdings 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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8Telecom International Holdings Co ROIC % Chart

8Telecom International Holdings Co Annual Data

Trend

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

ROIC %

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2.23

6.07

-1.16

-1.42

-61.96

8Telecom International Holdings Co Quarterly Data
	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Mar19	Jun19	Sep19
ROIC %	Get a 7-Day Free Trial															-83.48	-68.63	-3.72	-0.74	-3.72

Competitive Comparison of 8Telecom International Holdings Co's ROIC %

For the Communication Equipment subindustry, 8Telecom International Holdings 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.

8Telecom International Holdings Co's ROIC % Distribution in the Hardware Industry

For the Hardware industry and Technology sector, 8Telecom International Holdings Co's ROIC % distribution charts can be found below:

* The bar in red indicates where 8Telecom International Holdings Co's ROIC % falls into.

8Telecom International Holdings Co ROIC % Calculation

8Telecom International Holdings Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2017 is calculated as:

	ROIC % (A: Dec. 2017 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2016 )	+	Invested Capital (A: Dec. 2017 ))	/ count )
=	-2.292 * ( 1 - 0% )	/	( (4.116	+	3.282)	/ 2 )
=	-2.292	/	3.699
=	-61.96 %

where

	Invested Capital		(A: Dec. 2016 )
=	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	))
=	0.701	-	0.031	-	( 0.322	-	max(0, 3.96	-	0.514	+	0.322	))
=	4.116

	Invested Capital		(A: Dec. 2017 )
=	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	))
=	2.774	-	4.237	-	( 1.169	-	max(0, 7.041	-	2.296	+	1.169	))
=	3.282

8Telecom International Holdings Co's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2019 is calculated as:

	ROIC % (Q: Sep. 2019 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2019 )	+	Invested Capital (Q: Sep. 2019 ))	/ count )
=	-0.16 * ( 1 - 0% )	/	( (4.3	+	0)	/ 2 )
=	-0.16	/	2.15
=	-7.44 %

where

	Invested Capital		(Q: Jun. 2019 )
=	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	))
=	3.494	-	2.649	-	( 0	-	max(0, 4.799	-	1.344	+	0	))
=	4.3

	Invested Capital		(Q: Sep. 2019 )
=	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	))
=	1.344	-	2.689	-	( 0	-	max(0, 2.689	-	1.344	+	0	))
=	0

Note: The Operating Income data used here is four times the quarterly (Sep. 2019) data.

8Telecom International Holdings Co (SGX:AZG) 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, 8Telecom International Holdings Co's WACC % is 0.00%. 8Telecom International Holdings Co's ROIC % is 0.00% (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.

8Telecom International Holdings Co ROIC % Related Terms

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8Telecom International Holdings Co (SGX:AZG) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » 8Telecom International Holdings Co Ltd (SGX:AZG) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

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Address

20 Sin Ming Lane, Number 03-63, Midview City, Singapore, SGP, 573968

Website

http://www.8telecom.cn

8Telecom International Holdings Co Ltd is a communications services provider in Asia. The company is engaged in designing, manufacturing and distributing telecommunication pipes, telecommunication, and other towers, the provision of telecommunication engineering services, as well as the development of commercial property. The company is engaged in the following business segments, Telecommunications pipes, Telecommunications engineering services, Telecommunications and other towers and Property.

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