What is Return On Invested Capital (ROIC)?


 
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What is Return On Invested Capital (ROIC)?
Rujito, Manager, Indonesia

In my understanding, ROIC = [Net Operating Profit - Adjusted Tax] / [Invested Capital].
ROIC is used to measure how well companis generate earnings from invested capital in their business. If ROIC is greater than WACC, it is creating value by investing in the project.

 
   















 

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