"NOPAT 89190
Total Assets (NCA) 320996 + (CA) 213321
Excess cash = Cash - (Current Liabilities - Current Assets + Cash) = 120589 - (218045 - 213321 + 120589)
Non-Interest Bearing Current Liabilities include:
a) Trade and other payables = 86,818
b) Provision for reinstatement cost = 14,417
c) Tax payable = 9,854
If I calculate out, I'll get 30% out of it. But I may have realised an error, NOPAT should I use 4Q or FY16? I used FY16 hence that may caused the inflated number"
OKOK I took time to look into your figures. The big error comes from NOPAT, I cannot figure out how you get it, but it's like 4 times larger than what I got, which is why your ROIC becomes a crazy number.
Looking at what you wrote, my guess is that you probably got confused by what you read online. A lot of the generic sites give formulae but they're tailored more towards US equities.
In order to avoid being confused, it's best to take time to understand what you're trying to measure first, instead of jumping into the formula exactly. So as a guideline, you want to be able to use simple english words to describe the parameter and it's function, before you even apply it.
The basic use of ROIC is easy to understand: you want to know what's your return based on a certain amount of capital that you have utilized. That tells us how efficient the business machine is in churning out returns, if you feed it a certain amount of capital. It also tells us how good management is at utilizing this capital to generate returns for shareholders.
Reply to @ThumbTackInvestor : Still reading up on it, as always I'm able to get greater insight to things from your wisdom and analysis. sincerely thank you!
crab moving, will zhi char follow??
Reply to @ThumbTackInvestor : still prefer crab then pulling out tooth.. lol. thanks for the info.. weekend got crab eat liao.
thiam jiak Singaporean moving all the fnb counter liao.
"NOPAT 89190
Total Assets (NCA) 320996 + (CA) 213321
Excess cash = Cash - (Current Liabilities - Current Assets + Cash) = 120589 - (218045 - 213321 + 120589)
Non-Interest Bearing Current Liabilities include:
a) Trade and other payables = 86,818
b) Provision for reinstatement cost = 14,417
c) Tax payable = 9,854
If I calculate out, I'll get 30% out of it. But I may have realised an error, NOPAT should I use 4Q or FY16? I used FY16 hence that may caused the inflated number"
OKOK I took time to look into your figures. The big error comes from NOPAT, I cannot figure out how you get it, but it's like 4 times larger than what I got, which is why your ROIC becomes a crazy number.
Looking at what you wrote, my guess is that you probably got confused by what you read online. A lot of the generic sites give formulae but they're tailored more towards US equities.
In order to avoid being confused, it's best to take time to understand what you're trying to measure first, instead of jumping into the formula exactly. So as a guideline, you want to be able to use simple english words to describe the parameter and it's function, before you even apply it.
The basic use of ROIC is easy to understand: you want to know what's your return based on a certain amount of capital that you have utilized. That tells us how efficient the business machine is in churning out returns, if you feed it a certain amount of capital. It also tells us how good management is at utilizing this capital to generate returns for shareholders.
(cont on another comment)
Reply to @ThumbTackInvestor : Still reading up on it, as always I'm able to get greater insight to things from your wisdom and analysis. sincerely thank you!