ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. PT Goto Gojek Tokopedia Tbk's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was -8.96%.
As of today (2024-04-29), PT Goto Gojek Tokopedia Tbk's WACC % is 10.77%. PT Goto Gojek Tokopedia Tbk's ROIC % is -11.18% (calculated using TTM income statement data).
PT Goto Gojek Tokopedia Tbk earns returns that do not match up to its cost of capital. It will destroy value as it grows.
PT Goto Gojek Tokopedia Tbk ROIC % Historical 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.
Competitive Comparison of PT Goto Gojek Tokopedia Tbk's ROIC %
For the Software - Application subindustry, PT Goto Gojek Tokopedia Tbk'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.
PT Goto Gojek Tokopedia Tbk's ROIC % Distribution in the Software Industry
For the Software industry and Technology sector, PT Goto Gojek Tokopedia Tbk's ROIC % distribution charts can be found below:
* The bar in red indicates where PT Goto Gojek Tokopedia Tbk's ROIC % falls into.
PT Goto Gojek Tokopedia Tbk ROIC % Calculation
PT Goto Gojek Tokopedia Tbk's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (Dec. 2023) 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, PT Goto Gojek Tokopedia Tbk's WACC % is 10.77%. PT Goto Gojek Tokopedia Tbk's ROIC % is -11.18% (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.
PT Goto Gojek Tokopedia Tbk ROIC % Related Terms
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PT Goto Gojek Tokopedia Tbk (ISX:GOTO) Business Description
GoTo is an Indonesian ecosystem that combines e-commerce, ride-hailing, delivery, and financial services under one app. The company operates primarily in Indonesia and is the product of a merger between Gojek and Tokopedia in May 2021. The company has 64 million active paying users and 12 million merchants as of 2022 on its platform. In 2022, on-demand accounted for 55% of revenue, e-commerce for 37%, and financial services for 8%. However, 82% of nonfinancial services gross transactional value comes from e-commerce, as it is the focal point in the ecosystem. The company competes with giants such as Sea-backed Shopee, Alibaba's Lazada, and smaller peers such as Bukalapak in e-commerce—and with Grab in the ride-hailing and delivery business.
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