Microsoft Excel LibreOffice Calc

Costco Wholesale Corp. (COST)

Return on Capital (ROC)

Difficulty: Advanced

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.

Return on Invested Capital (ROIC)

Costco Wholesale Corp., ROIC calculation

Microsoft Excel LibreOffice Calc
Sep 2, 2018 Sep 3, 2017 Aug 28, 2016 Aug 30, 2015 Aug 31, 2014 Sep 1, 2013
Selected Financial Data (USD $ in millions)
Net operating profit after taxes (NOPAT)1 3,360  2,763  2,705  2,405  2,178  2,150 
Invested capital2 20,361  18,521  18,450  17,366  17,287  15,714 
Ratio
ROIC3 16.50% 14.92% 14.66% 13.85% 12.60% 13.68%

Based on: 10-K (filing date: 2018-10-26), 10-K (filing date: 2017-10-18), 10-K (filing date: 2016-10-12), 10-K (filing date: 2015-10-14), 10-K (filing date: 2014-10-15), 10-K (filing date: 2013-10-16).

2018 Calculations

1 NOPAT. See Details »

2 Invested capital. See Details »

3 ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 3,360 ÷ 20,361 = 16.50%

Ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Costco Wholesale Corp.’s ROIC improved from 2016 to 2017 and from 2017 to 2018.