Stealth Group Holdings (ASX:SGI) ROC % : 4.44% (As of Dec. 2023)

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What is Stealth Group Holdings ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Stealth Group Holdings's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 4.44%.

As of today (2024-05-23), Stealth Group Holdings's WACC % is 5.51%. Stealth Group Holdings's ROC % is 4.66% (calculated using TTM income statement data). Stealth Group Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Stealth Group Holdings ROC % Historical Data

The historical data trend for Stealth Group Holdings's ROC % 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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Stealth Group Holdings ROC % Chart

Stealth Group Holdings Annual Data

Trend

Jun19

Jun20

Jun21

Jun22

Jun23

ROC %

3.22

1.27

5.79

5.39

4.37

Stealth Group Holdings Semi-Annual Data
	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial						2.19	6.82	4.36	4.88	4.44

Stealth Group Holdings ROC % Calculation

Stealth Group Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2023 is calculated as:

	ROC % (A: Jun. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2022 )	+	Invested Capital (A: Jun. 2023 ))	/ count )
=	2.548 * ( 1 - 27.99% )	/	( (41.83	+	42.178)	/ 2 )
=	1.8348148	/	42.004
=	4.37 %

where

	Invested Capital		(A: Jun. 2022 )
=	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	))
=	61.54	-	18.612	-	( 4.75	-	max(0, 36.342	-	37.44	+	4.75	))
=	41.83

	Invested Capital		(A: Jun. 2023 )
=	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	))
=	63.426	-	21.054	-	( 7.727	-	max(0, 39.913	-	40.107	+	7.727	))
=	42.178

Stealth Group Holdings's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	2.92 * ( 1 - 35.47% )	/	( (42.178	+	42.661)	/ 2 )
=	1.884276	/	42.4195
=	4.44 %

where

	Invested Capital		(Q: Jun. 2023 )
=	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	))
=	63.426	-	21.054	-	( 7.727	-	max(0, 39.913	-	40.107	+	7.727	))
=	42.178

	Invested Capital		(Q: Dec. 2023 )
=	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	))
=	62.633	-	20.012	-	( 8.826	-	max(0, 39.186	-	39.146	+	8.826	))
=	42.661

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

Stealth Group Holdings (ASX:SGI) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 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 ROC % 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, Stealth Group Holdings's WACC % is 5.51%. Stealth Group Holdings's ROC % is 4.66% (calculated using TTM income statement data). Stealth Group Holdings 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 %, ROC % 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.

Stealth Group Holdings ROC % Related Terms

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Stealth Group Holdings (ASX:SGI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Distribution » Stealth Group Holdings Ltd (ASX:SGI) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

43 Cedric Street, Stirling, WA, AUS, 6021

Website

https://www.stealthgi.com

Stealth Group Holdings Ltd is an Australia based supplier and distributor of safety, industrial, healthcare and workplace consumables products. It is also a provider of supply chain solutions, with a focus on industrial, trade and consumer retail customer markets. The company's geographical segment includes Australia and International market. It derives a majority of revenue from Australia. Products offered by the company include clothing, footwear, first aid, medical consumables, workplace safety, disposable wipes, drilling, automotive and other industrial supplies and others.

Stealth Group Holdings (ASX:SGI) Headlines

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