ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Shikoku Electric Power Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 4.39%.
As of today (2024-12-13), Shikoku Electric Power Co's WACC % is 1.12%. Shikoku Electric Power Co's ROIC % is 3.37% (calculated using TTM income statement data).
Shikoku Electric Power Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
* 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.
Competitive Comparison of Shikoku Electric Power Co's ROIC %
For the Utilities - Regulated Electric subindustry, Shikoku Electric Power 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.
Shikoku Electric Power Co's ROIC % Distribution in the Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, Shikoku Electric Power Co's ROIC % distribution charts can be found below:
* The bar in red indicates where Shikoku Electric Power Co's ROIC % falls into.
Shikoku Electric Power Co ROIC % Calculation
Shikoku Electric Power Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2024 is calculated as:
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.
Shikoku Electric Power Co (TSE:9507) 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, Shikoku Electric Power Co's WACC % is 1.12%. Shikoku Electric Power Co's ROIC % is 3.37% (calculated using TTM income statement data).
Shikoku Electric Power Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
Shikoku Electric Power Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.
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.
Shikoku Electric Power Co ROIC % Related Terms
Thank you for viewing the detailed overview of Shikoku Electric Power Co's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Shikoku Electric Power Co Inc also known as Yonden Group, is an electric utility company that supplies electric power to customers in the Japan's Shikoku region. The company's principal activity is generating, transmitting, and distributing electricity. Shikoku Electric produces energy through its portfolio of coal, nuclear, oil, hydroelectric, and natural gas power plants. Thermal and nuclear assets represent the majority of its electric power generation capacity. Shikoku Electric segments its operations into electric utility, IT/communications, and "other" divisions. The vast majority of the company's revenue is derived by selling electricity produced by coal-fueled facilities and transmitted to industrial and commercial customers.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
TSE:9507 has been successfully added to your 