ROIC Calculator
Calculate a company's Return on Invested Capital (ROIC) to evaluate capital allocation.
Calculation Parameters
Specify your inputs below.
Calculated Result
Expert Tip
Comparing ROIC to WACC reveals if a company is actively creating economic value; ROIC should exceed WACC.
How this Calculator Works
This calculator computes Return on Invested Capital (ROIC), evaluating how efficiently a company allocates its debt and equity capital to generate profits from operations. It is a preferred metric to check if a company has a competitive advantage (moat). Investors use it to rate management.
Formula & Methodology
Step-by-Step Calculation Example
Here is a step-by-step example showing how the calculations are performed:
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Detailed Insights & Expert Guide
ℹ️ About this Calculation
This equity research and valuation calculator evaluates corporate fundamentals, stock price multiples, cost of capital, dividend discount models, and shareholder return metrics based on SEC financial reporting and Wall Street equity analysis standards.
Variable Glossary
Equity Inputs
Share price, earnings per share (EPS), dividend amount, book value, debt/equity ratio, or systematic beta coefficient.
Valuation Output
Price-to-Earnings (P/E), EV/EBITDA multiple, Intrinsic Value ($), WACC %, or Return on Equity (ROE %).
How to Calculate Step-by-Step
Step 1
Input current stock price, shares outstanding, or balance sheet / income statement numbers.
Step 2
Enter expected growth rate, cost of equity, or market risk premium assumptions.
Step 3
Review calculated valuation multiples, margin of safety comparison, or required rate of return.