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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Tango Therapeutics's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was -146.41%.
As of today (2024-10-29), Tango Therapeutics's WACC % is 9.39%. Tango Therapeutics's ROC % is -153.95% (calculated using TTM income statement data). Tango Therapeutics earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Tango Therapeutics'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.
Tango Therapeutics Annual Data | |||||||||
Trend | Dec20 | Dec21 | Dec22 | Dec23 | |||||
ROC % | -110.25 | -140.31 | -168.33 | -126.26 |
Tango Therapeutics Quarterly Data | ||||||||||||||||
Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | Jun23 | Sep23 | Dec23 | Mar24 | Jun24 | |
ROC % | Get a 7-Day Free Trial | -95.70 | -111.63 | -162.23 | -203.40 | -146.41 |
Tango Therapeutics's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:
ROC % (A: Dec. 2023 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (A: Dec. 2022 ) | + | Invested Capital (A: Dec. 2023 )) | / count ) |
= | -114.173 * ( 1 - -0.13% ) | / | ( (96.027 | + | 85.068) | / 2 ) |
= | -114.3214249 | / | 90.5475 | |||
= | -126.26 % |
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 | )) |
= | 436.47 | - | 20.716 | - | ( 366.133 | - | max(0, 55.545 | - | 375.272 | + | 366.133 | )) |
= | 96.027 |
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 | )) |
= | 402.567 | - | 16.899 | - | ( 336.885 | - | max(0, 45.938 | - | 346.538 | + | 336.885 | )) |
= | 85.068 |
Tango Therapeutics's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:
ROC % (Q: Jun. 2024 ) | ||||||
= | NOPAT | / | Average Invested Capital | |||
= | Operating Income * ( 1 - Tax Rate % ) | / | ( (Invested Capital (Q: Mar. 2024 ) | + | Invested Capital (Q: Jun. 2024 )) | / count ) |
= | -118.208 * ( 1 - -0.26% ) | / | ( (81.31 | + | 80.59) | / 2 ) |
= | -118.5153408 | / | 80.95 | |||
= | -146.41 % |
where
Invested Capital | (Q: Mar. 2024 ) | |||||||||||
= | 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 | )) |
= | 406.222 | - | 15.665 | - | ( 343.599 | - | max(0, 42.789 | - | 352.036 | + | 343.599 | )) |
= | 81.31 |
Invested Capital | (Q: Jun. 2024 ) | |||||||||||
= | 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 | )) |
= | 381.453 | - | 16.321 | - | ( 322.111 | - | max(0, 43.868 | - | 328.41 | + | 322.111 | )) |
= | 80.59 |
Note: The Operating Income data used here is four times the quarterly (Jun. 2024) 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.
Tango Therapeutics (NAS:TNGX) 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, Tango Therapeutics's WACC % is 9.39%. Tango Therapeutics's ROC % is -153.95% (calculated using TTM income statement data). Tango Therapeutics 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.
Thank you for viewing the detailed overview of Tango Therapeutics's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Third Rock Ventures Iv, L.p. | 10 percent owner | 29 NEWBURY STREET, 3RD FLOOR, BOSTON MA 02116 |
Mva Investors, Llc | other: See remarks | 12860 EL CAMINO REAL, SUITE 300, SAN DIEGO CA 92130 |
Lesley Ann Calhoun | director | C/O GLOBAL BLOOD THERAPEUTICS, INC., 171 OYSTER POINT BOULEVARD, SUITE 300, SOUTH SAN FRANCISCO CA 94080 |
Douglas Barry | officer: See Remarks | TANGO THERAPEUTICS, INC., 100 BINNEY STREET, UNIT 700, CAMBRIDGE MA 02142 |
Adam Crystal | officer: See Remarks | C4 THERAPEUTICS, INC., 490 ARSENAL WAY, SUITE 200, WATERTOWN MA 02472 |
Barbara Weber | director, officer: Chief Executive Officer | C/O REVOLUTION MEDICINES, INC., 700 SAGINAW DRIVE, REDWOOD CITY CA 94063 |
Daniella Beckman | officer: Chief Financial Officer | C/O IDENIX PHARMACEUTICALS, INC., ONE KENDALL SQUARE, BLDG. 1400, CAMBRIDGE MA 02139 |
Boxer Capital, Llc | other: See remarks | 12860 EL CAMINO REAL, SUITE 300, SAN DIEGO CA 92130 |
Ecor1 Capital, Llc | 10 percent owner | 357 TEHAMA STREET #3, SAN FRANCISCO CA 94103 |
John B Ketchum | director | TANGO THERAPEUTICS, INC., 201 BROOKLINE AVE., SUITE 901, BOSTON MA 02215 |
Joseph Lewis | other: See remarks | PO BOX N7776, LYFORD BAHAMAS |
Trv Gp Vi, Llc | director | 201 BROOKLINE AVE., BOSTON MA 02215 |
Third Rock Ventures Gp Vi, L.p. | director | 201 BROOKLINE AVE, SUITE 1401, BOSTON MA 02215 |
Third Rock Ventures Vi, L.p. | director | 29 NEWBURY STREET, 3RD FLOOR, BOSTON MA 02116 |
Boxer Asset Management Inc. | other: See remarks | CAY HOUSE, EP TAYLOR DRIVE N7776, LYFORD CAY, NEW PROVIDENCE C5 00000 |
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