Return on invested capital (ROIC) is one of the most important profitability metrics. It measures how efficiently a company generates profit from the capital invested in its business. Invested capital includes debt, equity funding, and leases. ROIC shows how well a company converts this capital into operating profits. A higher ROIC generally indicates more effective capital allocation and stronger financial performance.
Calculations of ROIC can differ. The data for this analysis comes from Koyfin. The formula used is net profit after tax (NOPAT) divided by the average invested capital over the past two years. NOPAT is the same as earnings before interest and taxes (EBIT), except it subtracts taxes paid.
