Why Return on Invested Capital is So Important

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In this video I talk about the importance of the Return on Invested Capital (ROIC/ROC/ROI). I start by giving the formula for calculating the ROIC and how it can be used to assess the management and economic moat (competitive advantage) of public companies on the stock market. Then I discuss the key reason why it is important to understand what the ROIC tells us, and how you can go about analysing it. What does it mean when an ROIC is trending up over time, flat over time, or trending down over time.

If you have any questions about investing metrics then leave them down in the comment section below!

ROIC: https://www.investopedia.com/terms/r/returnoninvestmentcapital.asp
WACC: https://thejoexpedition.wordpress.com/2016/10/13/measuring-economic-moat-roic-vs-wacc/

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Disclaimer:
The information in this video is general information only and should not be taken as constituting professional advice from Hamish Hodder.
Hamish Hodder is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the information relates to your unique circumstances.
Hamish Hodder is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this video.

Видео Why Return on Invested Capital is So Important канала Hamish Hodder