ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Electric Power Development Co's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2024 was 0.79%.
As of today (2024-12-15), Electric Power Development Co's WACC % is 1.03%. Electric Power Development Co's ROIC % is 1.82% (calculated using TTM income statement data).
Electric Power Development 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.
Electric Power Development Co ROIC % Historical 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.
Competitive Comparison of Electric Power Development Co's ROIC %
For the Utilities - Renewable subindustry, Electric Power Development 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.
Electric Power Development Co's ROIC % Distribution in the Utilities - Independent Power Producers Industry
For the Utilities - Independent Power Producers industry and Utilities sector, Electric Power Development Co's ROIC % distribution charts can be found below:
* The bar in red indicates where Electric Power Development Co's ROIC % falls into.
Electric Power Development Co ROIC % Calculation
Electric Power Development 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.
Electric Power Development Co (TSE:9513) 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, Electric Power Development Co's WACC % is 1.03%. Electric Power Development Co's ROIC % is 1.82% (calculated using TTM income statement data).
Electric Power Development 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.
Electric Power Development 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.
Electric Power Development Co ROIC % Related Terms
Thank you for viewing the detailed overview of Electric Power Development Co's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Electric Power Development Co Business Description
Electric Power Development Co Ltd which operates under the brand J-POWER, is a Japanese electric utility company involved in the generation, transmission, distribution, and retail sale of energy. The company operates a portfolio of hydroelectric, wind, nuclear, geothermal, and thermal power plants located mainly throughout Japan, but also elsewhere in Southeast Asia and North America. While a majority of Electric Power Development's power-generating facilities are hydroelectric, the company's total electric power production can be divided fairly evenly between its thermal and hydroelectric sites. Electric Power Development generates almost all of its revenue from its electric utility operations, which mainly comprise the sale of energy from its thermal power plants.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
TSE:9513 has been successfully added to your 