Monsanto Co (XSWX:MOO) ROIC % : 30.72% (As of Feb. 2018)

Monsanto Co ROIC % Chart

Monsanto Co Annual Data
	Trend	Aug08	Aug09	Aug10	Aug11	Aug12	Aug13	Aug14	Aug15	Aug16	Aug17
ROIC %		Get a 7-Day Free Trial					16.53	17.39	16.91	10.34	15.04

Monsanto Co Quarterly Data
	May13	Aug13	Nov13	Feb14	May14	Aug14	Nov14	Feb15	May15	Aug15	Nov15	Feb16	May16	Aug16	Nov16	Feb17	May17	Aug17	Nov17	Feb18
ROIC %	Get a 7-Day Free Trial															31.80	20.03	0.14	4.25	30.72

Competitive Comparison of Monsanto Co's ROIC %

For the Agricultural Inputs subindustry, Monsanto 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.

Monsanto Co's ROIC % Distribution in the Agriculture Industry

For the Agriculture industry and Basic Materials sector, Monsanto Co's ROIC % distribution charts can be found below:

* The bar in red indicates where Monsanto Co's ROIC % falls into.

Monsanto Co ROIC % Calculation

Monsanto Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Aug. 2017 is calculated as:

where

Monsanto Co's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Feb. 2018 is calculated as:

where

Note: The Operating Income data used here is four times the quarterly (Feb. 2018) 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.

Monsanto Co  (XSWX:MOO) 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, Monsanto Co's WACC % is 0.00%. Monsanto 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.

Monsanto Co ROIC % Related Terms

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Monsanto Co (XSWX:MOO) Business Description