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Shopify (NYSE:SHOP) 5-Year ROIIC %

: 5.63% (As of Dec. 2021)
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5-Year Return on Invested Incremental Capital (5-Year ROIIC %) measures the change in earnings as a percentage of change in investment over 5-year. Shopify's 5-Year ROIIC % for the quarter that ended in Dec. 2021 was 5.63%. High ROIIC is generally an indication that your business is capital efficient or has a higher operating leverage.

The industry rank for Shopify's 5-Year ROIIC % or its related term are showing as below:

SHOP's 5-Year ROIIC % is ranked better than
54.3% of 2595 companies
in the Software industry
Industry Median: 3.32 vs SHOP: 5.63

Shopify (NYSE:SHOP) 5-Year ROIIC % Competitive Comparison

For the Software - Application subindustry, Shopify's 5-Year ROIIC %, along with its competitors' market caps and 5-Year ROIIC % 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.

   

Shopify (NYSE:SHOP) 5-Year ROIIC % Distribution

For the Software industry and Technology sector, Shopify's 5-Year ROIIC % distribution charts can be found below:

* The bar in red indicates where Shopify's 5-Year ROIIC % falls into.



Shopify 5-Year ROIIC % Calculation

Shopify's 5-Year ROIIC % for the quarter that ended in is calculated as:

5-Year ROIIC %=5-Year Incremental Net Operating Profit After Taxes (NOPAT)/5-Year Incremental Invested Capital
=( 249.3275683 (Dec. 2021) - -37.165 (Dec. 2016) )/( 5179.713 (Dec. 2021) - 94.922 (Dec. 2016) )
=286.4925683/5084.791
=5.63 %

* 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.

Annual data of NOPAT and Invested Capital was used to calculate 5-Year ROIIC %.


Shopify  (NYSE:SHOP) 5-Year ROIIC % Explanation

Return on Incremental Invested Capital (ROIIC) is an extension of Return on Investment Capital (ROIC). ROIC % tells investors how efficiently that profitability is earned per dollar of company capital. ROIIC narrows the focus even further and shows how profitable each additional unit of capital investment could be. ROIIC % is a more powerful metric than ROIC because it measures how much money the company can generate going forward on future capital investments.

High ROIIC is generally an indication that your business is capital efficient or has a higher operating leverage.

Be Aware

It's important to keep in mind that when tracking ROIIC, the metric is better suited to forecasting the trend of future returns rather than measuring current return on investment.


Shopify 5-Year ROIIC % Related Terms

Thank you for viewing the detailed overview of Shopify's 5-Year ROIIC % provided by GuruFocus.com. Please click on the following links to see related term pages.


Shopify (NYSE:SHOP) Business Description

Shopify logo
Traded in Other Exchanges
Address
151 O'Connor Street, Ground Floor, Ottawa, ON, CAN, K2P2L8
Shopify offers an e-commerce platform primarily to small and midsize businesses. The firm has two segments: subscription solutions (43% of fiscal 2018 revenue) and merchant solutions (57% of fiscal 2018 revenue). The subscription solutions segment allows Shopify merchants to conduct e-commerce on a variety of platforms, including the company's website, physical stores, pop-up stores, kiosks, social networks (Facebook), and Amazon. Merchant solutions are add-on products for the platform that facilitate e-commerce and include Shopify Payments, Shopify Shipping, and Shopify Capital.

Shopify (NYSE:SHOP) Headlines

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