Return on Capital (ROC)
Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company debt and equity structure. It measures business productivity performance.
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- Statement of Comprehensive Income
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Enterprise Value (EV)
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Dividend Discount Model (DDM)
- Debt to Equity since 2010
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Return on Invested Capital (ROIC)
Charter Communications Inc., ROIC calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| ROIC3 | ||||||
| Benchmarks | ||||||
| ROIC, Competitors4 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Invested capital. See details »
3 2024 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
The financial data reveals notable trends in profitability and capital investment over the period from 2020 to 2024. The net operating profit after taxes (NOPAT) shows a general upward trajectory, with an initial value of 7,242 million US dollars in 2020 reaching 9,837 million US dollars by 2024. Despite a slight dip in 2023 compared to 2022, the overall increase suggests an improvement in operating efficiency or revenue generation capacity.
Invested capital exhibits moderate growth over the same period, increasing from 133,151 million US dollars in 2020 to 136,388 million US dollars in 2024. The fluctuations are relatively small, indicating a stable capital base with gradual expansion rather than large-scale investments or divestitures.
The return on invested capital (ROIC) reflects the company's efficiency in generating returns from its invested resources. Starting at 5.44% in 2020, ROIC rises substantially to 7.38% by 2022, then experiences a slight decline to 6.99% in 2023, before recovering to 7.21% in 2024. This pattern correlates with the trends in NOPAT and invested capital, showing an overall improvement in capital efficiency despite minor fluctuations.
- Net operating profit after taxes (NOPAT)
- Shows significant growth from 7,242 million US dollars in 2020 to 9,837 million US dollars in 2024, with a minor decrease in 2023.
- Invested capital
- Increases modestly from 133,151 million US dollars in 2020 to 136,388 million US dollars in 2024, indicating stable investment levels.
- Return on invested capital (ROIC)
- Improves from 5.44% in 2020 to 7.21% in 2024, confirming enhanced efficiency in utilizing capital, though with slight volatility.
Overall, the data suggests a positive trend in operational profitability and capital efficiency, supported by gradual increases in invested capital. The slight variations in 2023 across the metrics warrant monitoring, but the return to growth in 2024 indicates resilience and continuing financial strength.
Decomposition of ROIC
Charter Communications Inc., decomposition of ROIC
| ROIC | = | OPM1 | × | TO2 | × | 1 – CTR3 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | × | ||||
| Dec 31, 2023 | = | × | × | ||||
| Dec 31, 2022 | = | × | × | ||||
| Dec 31, 2021 | = | × | × | ||||
| Dec 31, 2020 | = | × | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
- Operating Profit Margin (OPM)
- The operating profit margin exhibited a consistent upward trend from 17.1% in 2020 to 23.05% in 2024. The margin increased notably between 2020 and 2022, from 17.1% to 22.53%, and then stabilized with marginal fluctuations in subsequent years, reaching 23.05% in 2024. This indicates improving operational efficiency and profitability over the period.
- Turnover of Capital (TO)
- The turnover of capital ratio displayed a gradual increase from 0.36 in 2020 to 0.41 in 2022, remaining stable at 0.41 in 2023 before slightly declining to 0.40 in 2024. This suggests a modest improvement in how efficiently capital is utilized to generate revenue, although the ratio plateaued in later years.
- 1 – Effective Cash Tax Rate (CTR)
- The metric reflecting 1 minus the effective cash tax rate showed a decreasing trend from 88.08% in 2020 to 77.54% in 2024. The rate declined steadily, particularly between 2021 and 2023, indicating an increase in the effective cash tax rate over time that could impact net profitability.
- Return on Invested Capital (ROIC)
- Return on invested capital increased from 5.44% in 2020 to a peak of 7.38% in 2022, followed by a slight decline to 6.99% in 2023 and a moderate recovery to 7.21% in 2024. Overall, the ROIC improved significantly over the observed period, reflecting enhanced returns generated on invested capital despite minor fluctuations in the mid-term.
Operating Profit Margin (OPM)
Charter Communications Inc., OPM calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Add: Cash operating taxes2 | ||||||
| Net operating profit before taxes (NOPBT) | ||||||
| Revenues | ||||||
| Add: Increase (decrease) in deferred revenue | ||||||
| Adjusted revenues | ||||||
| Profitability Ratio | ||||||
| OPM3 | ||||||
| Benchmarks | ||||||
| OPM, Competitors4 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
OPM = 100 × NOPBT ÷ Adjusted revenues
= 100 × ÷ =
4 Click competitor name to see calculations.
- Net Operating Profit Before Taxes (NOPBT)
- The net operating profit before taxes demonstrated a consistent upward trend over the analyzed period. Starting at $8,222 million in 2020, the figure increased steadily to $10,433 million in 2021 and $12,181 million in 2022. Although there was a slight dip in 2023 to $12,153 million, the value rose again in 2024 to reach $12,686 million. Overall, this indicates improving profitability with minor fluctuations.
- Adjusted Revenues
- Adjusted revenues showed a continuous, moderate increase throughout the five-year period. Beginning at $48,074 million in 2020, revenues rose to $51,701 million in 2021, followed by $54,072 million in 2022. Growth continued, albeit at a slower pace, with revenues reaching $54,605 million in 2023 and $55,032 million in 2024. This steady revenue growth reflects consistent business expansion or sustained demand.
- Operating Profit Margin (OPM)
- The operating profit margin exhibited a positive trend, improving from 17.1% in 2020 to 20.18% in 2021 and climbing further to 22.53% in 2022. A slight decrease was noted in 2023, down to 22.26%, but the margin recovered to 23.05% in 2024. These figures suggest enhanced operational efficiency and profitability margins over time, despite minor short-term variations.
- Summary
- Overall, the financial data indicate steady growth in both revenues and profitability metrics across the five-year horizon. Net operating profit before taxes and operating profit margin increased consistently, signaling improved operational performance and cost management. Revenues expanded gradually, supporting the sustainability of profit growth. Minor fluctuations in the latter years do not significantly detract from the positive long-term trends observed.
Turnover of Capital (TO)
Charter Communications Inc., TO calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | ||||||
| Add: Increase (decrease) in deferred revenue | ||||||
| Adjusted revenues | ||||||
| Invested capital1 | ||||||
| Efficiency Ratio | ||||||
| TO2 | ||||||
| Benchmarks | ||||||
| TO, Competitors3 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Invested capital. See details »
2 2024 Calculation
TO = Adjusted revenues ÷ Invested capital
= ÷ =
3 Click competitor name to see calculations.
The data reveals a consistent upward trend in adjusted revenues over the five-year period. Starting from US$48,074 million in 2020, the revenues increased steadily year over year, reaching US$55,032 million in 2024. This represents a cumulative growth, indicating sustained revenue expansion.
Regarding invested capital, the values show slight fluctuations but an overall gradual increase. The invested capital decreased marginally from US$133,151 million in 2020 to US$130,911 million in 2021, then rebounded slightly and stabilized with a steady rise towards US$136,388 million by 2024. This suggests moderate new investments or adjustments to the capital base during this timeframe.
The turnover of capital ratio, calculated as adjusted revenues divided by invested capital, demonstrates a positive trend in efficiency during the initial years. It rose from 0.36 in 2020 to 0.41 in 2022 and remained stable at 0.41 in 2023 before experiencing a slight decline to 0.40 in 2024. The overall high turnover ratio indicates the company’s effective utilization of invested capital to generate revenues, though the minor decrease in the final year may warrant closer observation.
- Revenue Trend
- Consistent year-over-year growth, indicating increasing sales and market presence.
- Invested Capital
- Minor fluctuations with an overall upward trajectory, reflecting steady capital investment or stable asset base.
- Capital Turnover Ratio
- Improved between 2020 and 2022, maintained peak efficiency in 2023, and slightly declined in 2024, remaining relatively high.
Effective Cash Tax Rate (CTR)
Charter Communications Inc., CTR calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net operating profit after taxes (NOPAT)1 | ||||||
| Add: Cash operating taxes2 | ||||||
| Net operating profit before taxes (NOPBT) | ||||||
| Tax Rate | ||||||
| CTR3 | ||||||
| Benchmarks | ||||||
| CTR, Competitors4 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2024 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × ÷ =
4 Click competitor name to see calculations.
- Cash Operating Taxes
- The cash operating taxes have shown a consistent upward trend over the five-year period. Starting from $980 million in 2020, the taxes increased to $1,100 million in 2021. A more pronounced rise occurred in 2022, when the figure reached $2,493 million, followed by further increases to $2,776 million in 2023 and $2,849 million in 2024. This indicates an overall growth in tax payments, nearly tripling from 2020 to 2024.
- Net Operating Profit Before Taxes (NOPBT)
- The net operating profit before taxes also demonstrated growth but at a steadier pace. Beginning at $8,222 million in 2020, it increased significantly to $10,433 million in 2021 and continued rising to $12,181 million in 2022. The profit level remained relatively stable in 2023 with $12,153 million and showed a moderate increase to $12,686 million in 2024. This suggests that operating profitability has strengthened over the period, although there was a slight plateau between 2022 and 2023.
- Effective Cash Tax Rate (CTR)
- The effective cash tax rate exhibited a notable increase during the evaluated timeframe. Starting at 11.92% in 2020, it decreased slightly to 10.54% in 2021. However, from 2022 onwards, the rate increased sharply to 20.47%, continuing to rise to 22.84% in 2023, before a minor decline to 22.46% in 2024. The higher tax rates in the latter years explain the disproportionately large increases in cash operating taxes, despite only moderate growth in operating profits.