ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Cardinal Ethanol LLC's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was -5.97%.
As of today (2024-05-26), Cardinal Ethanol LLC's WACC % is 1.18%. Cardinal Ethanol LLC's ROIC % is 26.10% (calculated using TTM income statement data).
Cardinal Ethanol LLC generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
* 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.
Competitive Comparison of Cardinal Ethanol LLC's ROIC %
For the Chemicals subindustry, Cardinal Ethanol LLC'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.
Cardinal Ethanol LLC's ROIC % Distribution in the Chemicals Industry
For the Chemicals industry and Basic Materials sector, Cardinal Ethanol LLC's ROIC % distribution charts can be found below:
* The bar in red indicates where Cardinal Ethanol LLC's ROIC % falls into.
Cardinal Ethanol LLC ROIC % Calculation
Cardinal Ethanol LLC's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Sep. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (Mar. 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.
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, Cardinal Ethanol LLC's WACC % is 1.18%. Cardinal Ethanol LLC's ROIC % is 26.10% (calculated using TTM income statement data).
Cardinal Ethanol LLC generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
Cardinal Ethanol LLC 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 %, 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.
Cardinal Ethanol LLC ROIC % Related Terms
Thank you for viewing the detailed overview of Cardinal Ethanol LLC's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Cardinal Ethanol LLC (Cardinal Ethanol LLC) Business Description
Cardinal Ethanol LLC is a producer and seller of fuel-grade ethanol, distiller's grains, corn oil, and carbon dioxide throughout the continent of the United States. The company's prime selling products include ethanol, dried distillers grains, corn oil, and carbon dioxide. Its two operating segments are ethanol production through the Ethanol Division; and trading of agricultural grains through the Trading Division. The revenues from Ethanol Division come from primary sources: sales of fuel ethanol which is the key revenue driver. Revenues from the Trading Division are derived from procuring, transporting, and selling grain commodities. The majority of the revenue for the company is generated from its Ethanol Division.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
CRDE has been successfully added to your 