OPT Sciences (OPT Sciences) ROC % : 44.54% (As of Jul. 2015)

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What is OPT Sciences 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 %. OPT Sciences's annualized return on capital (ROC %) for the quarter that ended in Jul. 2015 was 44.54%.

As of today (2024-05-19), OPT Sciences's WACC % is 0.00%. OPT Sciences's ROC % is 0.00% (calculated using TTM income statement data). OPT Sciences earns returns that do not match up to its cost of capital. It will destroy value as it grows.

OPT Sciences ROC % Historical Data

The historical data trend for OPT Sciences'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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OPT Sciences ROC % Chart

OPT Sciences Annual Data

Trend

Oct05

Oct06

Oct07

Oct08

Oct09

Oct10

Oct11

Oct12

Oct13

Oct14

ROC %

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19.52

33.34

27.57

27.68

25.57

OPT Sciences Quarterly Data
	Oct10	Jan11	Apr11	Jul11	Oct11	Jan12	Apr12	Jul12	Oct12	Jan13	Apr13	Jul13	Oct13	Jan14	Apr14	Jul14	Oct14	Jan15	Apr15	Jul15
ROC %	Get a 7-Day Free Trial															22.46	46.13	26.03	44.75	44.54

OPT Sciences ROC % Calculation

OPT Sciences's annualized Return on Capital (ROC %) for the fiscal year that ended in Oct. 2014 is calculated as:

	ROC % (A: Oct. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Oct. 2013 )	+	Invested Capital (A: Oct. 2014 ))	/ count )
=	1.244 * ( 1 - 35.96% )	/	( (2.926	+	3.304)	/ 2 )
=	0.7966576	/	3.115
=	25.57 %

where

	Invested Capital		(A: Oct. 2013 )
=	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	))
=	13.569	-	0.242	-	( 10.401	-	max(0, 0.51	-	12.485	+	10.401	))
=	2.926

	Invested Capital		(A: Oct. 2014 )
=	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	))
=	14.716	-	0.151	-	( 11.261	-	max(0, 0.544	-	13.691	+	11.261	))
=	3.304

OPT Sciences's annualized Return on Capital (ROC %) for the quarter that ended in Jul. 2015 is calculated as:

	ROC % (Q: Jul. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Apr. 2015 )	+	Invested Capital (Q: Jul. 2015 ))	/ count )
=	2.308 * ( 1 - 38.94% )	/	( (3.093	+	3.235)	/ 2 )
=	1.4092648	/	3.164
=	44.54 %

where

	Invested Capital		(Q: Apr. 2015 )
=	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	))
=	15.462	-	0.265	-	( 12.104	-	max(0, 0.578	-	14.487	+	12.104	))
=	3.093

	Invested Capital		(Q: Jul. 2015 )
=	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	))
=	15.923	-	0.353	-	( 12.335	-	max(0, 0.669	-	14.881	+	12.335	))
=	3.235

Note: The Operating Income data used here is four times the quarterly (Jul. 2015) data.

OPT Sciences (OTCPK:OPST) 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, OPT Sciences's WACC % is 0.00%. OPT Sciences's ROC % is 0.00% (calculated using TTM income statement data). OPT Sciences 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.

OPT Sciences ROC % Related Terms

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OPT Sciences (OPT Sciences) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Aerospace & Defense » OPT Sciences Corp (OTCPK:OPST) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

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Address

1912 Bannard Street, Cinnaminson, NJ, USA, 08077

Website

http://www.optsciences.com

OPT Sciences Corp through its operating subsidiary O & S Research, manufactures precision optical components for the Aerospace Industry. It provides anti-glare optical coatings, panels for liquid crystal displays ("LCD"), LCD glass heaters, and electromagnetic interference shielding glass. In addition, it also offers glass cutting, grinding, and painting services. Geographically, the activities are performed in the United States and it derives revenue from product sales when products are shipped to customers.

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