United Nova Technology Co (SHSE:688469) ROC % : -4.12% (As of Mar. 2024)

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What is United Nova Technology Co ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. United Nova Technology Co's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -4.12%.

As of today (2024-05-24), United Nova Technology Co's WACC % is 8.35%. United Nova Technology Co's ROC % is -5.81% (calculated using TTM income statement data). United Nova Technology Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

United Nova Technology Co ROC % Historical Data

The historical data trend for United Nova Technology Co'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.

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United Nova Technology Co ROC % Chart

United Nova Technology Co Annual Data

Trend

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

-12.82

-16.24

-10.15

-3.98

-6.42

United Nova Technology Co Quarterly Data
	Dec19	Dec20	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial								-5.11	-5.03	-4.40	-9.44	-4.12

United Nova Technology Co ROC % Calculation

United Nova Technology Co'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 )
=	-1669.564 * ( 1 - 0% )	/	( (23808.366	+	28221.685)	/ 2 )
=	-1669.564	/	26015.0255
=	-6.42 %

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	))
=	25859.558	-	4334.149	-	( 2845.778	-	max(0, 8797.955	-	6514.998	+	2845.778	))
=	23808.366

	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	))
=	31570.366	-	3120.16	-	( 4045.59	-	max(0, 6809.129	-	7037.65	+	4045.59	))
=	28221.685

United Nova Technology Co's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	-1159.368 * ( 1 - 0% )	/	( (28221.685	+	28001.183)	/ 2 )
=	-1159.368	/	28111.434
=	-4.12 %

where

	Invested Capital		(Q: 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	))
=	31570.366	-	3120.16	-	( 4045.59	-	max(0, 6809.129	-	7037.65	+	4045.59	))
=	28221.685

	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	))
=	34947.66	-	3253.204	-	( 5856.779	-	max(0, 6486.634	-	10179.907	+	5856.779	))
=	28001.183

Note: The Operating Income data used here is four times the quarterly (Mar. 2024) data.

United Nova Technology Co (SHSE:688469) 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, United Nova Technology Co's WACC % is 8.35%. United Nova Technology Co's ROC % is -5.81% (calculated using TTM income statement data). United Nova Technology Co 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.

United Nova Technology Co ROC % Related Terms

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United Nova Technology Co (SHSE:688469) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » United Nova Technology Co Ltd (SHSE:688469) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

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Address

No. 518 Linjiang Road, Gaobu Street, Yuecheng District, Zhejiang Province, Shaoxing, CHN, 312000

Website

https://www.smecs.com

United Nova Technology Co Ltd formerly Semiconductor Manufacturing Electronics (Shaoxing) Corp provides foundry services focusing on technology solutions for power, connection and sensor signal chains. On top of wafer foundry service, SMEC also extended its foundry service to module packages in order to support semiconductor companies with a one-stop solution. SMEC provides a complete manufacturing platform to support customer mass production as well as technology development.

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