Ludwig Enterprises (Ludwig Enterprises) ROIC % : -54.55% (As of Dec. 2023)

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What is Ludwig Enterprises ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Ludwig Enterprises's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was -54.55%.

As of today (2024-05-22), Ludwig Enterprises's WACC % is 23.82%. Ludwig Enterprises's ROIC % is -28.38% (calculated using TTM income statement data). Ludwig Enterprises earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ludwig Enterprises ROIC % Historical Data

The historical data trend for Ludwig Enterprises's ROIC % 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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Ludwig Enterprises ROIC % Chart

Ludwig Enterprises Annual Data

Trend

Dec22

Dec23

ROIC %

-42.02

-107.50

Ludwig Enterprises Quarterly Data
	Sep22	Dec22	Sep23	Dec23
ROIC %	-	-82.70	-60.19	-54.55

Competitive Comparison of Ludwig Enterprises's ROIC %

For the Medical Devices subindustry, Ludwig Enterprises'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.

Ludwig Enterprises's ROIC % Distribution in the Medical Devices & Instruments Industry

For the Medical Devices & Instruments industry and Healthcare sector, Ludwig Enterprises's ROIC % distribution charts can be found below:

* The bar in red indicates where Ludwig Enterprises's ROIC % falls into.

Ludwig Enterprises ROIC % Calculation

Ludwig Enterprises's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROIC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-1.454 * ( 1 - 0% )	/	( (1.335	+	1.37)	/ 2 )
=	-1.454	/	1.3525
=	-107.50 %

where

	Invested Capital		(A: Dec. 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	))
=	0.516	-	0.007	-	( 0.516	-	max(0, 1.342	-	0.516	+	0.516	))
=	1.335

	Invested Capital		(A: 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	))
=	0.112	-	0.204	-	( 0.108	-	max(0, 1.574	-	0.112	+	0.108	))
=	1.37

Ludwig Enterprises's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROIC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-0.72 * ( 1 - 0% )	/	( (1.27	+	1.37)	/ 2 )
=	-0.72	/	1.32
=	-54.55 %

where

	Invested Capital		(Q: Sep. 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	))
=	0.011	-	0.086	-	( 0.007	-	max(0, 1.356	-	0.011	+	0.007	))
=	1.27

	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	))
=	0.112	-	0.204	-	( 0.108	-	max(0, 1.574	-	0.112	+	0.108	))
=	1.37

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Ludwig Enterprises (OTCPK:LUDG) 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, Ludwig Enterprises's WACC % is 23.82%. Ludwig Enterprises's ROIC % is -28.38% (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.

Ludwig Enterprises ROIC % Related Terms

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Ludwig Enterprises (Ludwig Enterprises) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Ludwig Enterprises Inc (OTCPK:LUDG) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

1749 VICTORIAN AVENUE, Suite C-350, Sparks, NV, USA, 89431

Website

https://www.ludwigent.com

Ludwig Enterprises Inc is a publicly traded Medical Technology Holding Company with Precision Genomics, Inc. and MyRNA for Life, Inc. as wholly owned subsidiaries. The company's advancements in medical technology and Artificial Intelligence (AI) have awarded it with cutting-edge genomic tools. These genomic tools have the potential to detect diseases early but also to customize treatments that may improve patient outcomes and, in some cases, even extend life. Ludwig is at the forefront of this new era with their proprietary mRNA genetic technology that has the potential to detect genetic biomarkers for inflammatory-driven diseases, including but not limited to heart disease, diabetes, preeclampsia, and cancer. It manages its business on the basis of one operating and reportable segment.