Balance Sheet & Working Capital
ROIC
Measures how much result a concrete financial line item in the app generates relative to the capital, assets or equity used. It is one of the clearest reads on economic quality and reinvestment discipline.
ROIC
returnOnInvestedCapital · Balance Sheet & Working Capital
- Definition
- Measures how much result a concrete financial line item in the app generates relative to the capital, assets or equity used. It is one of the clearest reads on economic quality and reinvestment discipline.
- Uses
- Very useful in compounders, branded franchises, profitable software and industrials with measurable capital. It can mislead with high goodwill, aggressive buybacks, old depreciated assets or unrecognized internal intangibles. Cross-check organic growth, FCF, margins and capital structure.
