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GCP Applied Technologies Earnings Perspective: Return On Invested Capital

Author: Benzinga Insights | June 03, 2022 11:45am

GCP Applied Technologies (NYSE:GCP) brought in sales totaling $237.30 million during Q1 according to data provided by Benzinga Pro. However, earnings decreased 305.26%, resulting in a loss of $3.90 million. In Q4, GCP Applied Technologies earned $1.90 million, and total sales reached $244.30 million.

What Is Return On Invested Capital?

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q1, GCP Applied Technologies posted an ROIC of 1.03%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q1, GCP Applied Technologies posted an ROIC of 1.03%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

For GCP Applied Technologies, the positive return on invested capital ratio of 1.03% suggests that management is allocating their capital effectively. Effective capital allocation is a positive indicator that a company will achieve more durable success and favorable long-term returns.

Analyst Predictions

GCP Applied Technologies reported Q1 earnings per share at $0.04/share, which did not meet analyst predictions of $0.1/share.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

Posted In: GCP

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