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.
Return on Invested Capital (ROIC)
Ulta Beauty Inc., ROIC calculation, comparison to benchmarks
| Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 1,347,343) | 1,087,749) | 242,025) | 813,424) | 777,837) | 527,431) | |
| Invested capital2 | 4,117,969) | 3,684,509) | 4,184,136) | 3,966,351) | 4,338,625) | 3,940,229) | |
| Performance Ratio | |||||||
| ROIC3 | 32.72% | 29.52% | 5.78% | 20.51% | 17.93% | 13.39% | |
| Benchmarks | |||||||
| ROIC, Competitors4 | |||||||
| Amazon.com Inc. | 9.75% | -2.09% | 18.50% | 16.11% | 12.59% | — | |
| Home Depot Inc. | 32.97% | 37.57% | 28.36% | 35.06% | 35.92% | — | |
| Lowe’s Cos. Inc. | 28.41% | 37.37% | 24.73% | 19.08% | 11.47% | — | |
| TJX Cos. Inc. | 18.64% | 18.30% | 1.20% | 18.89% | 18.37% | — | |
Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).
1 NOPAT. See details »
2 Invested capital. See details »
3 2023 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 1,347,343 ÷ 4,117,969 = 32.72%
4 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| ROIC | A measure of the periodic, after tax, cash-on-cash yield earned in the business. | Ulta Beauty Inc. ROIC improved from 2021 to 2022 and from 2022 to 2023. |
Decomposition of ROIC
Ulta Beauty Inc., decomposition of ROIC
Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
The primary reason for the increase in return on invested capital (ROIC) over 2023 year is the increase in efficiency measured by turnover of capital (TO) ratio.
Operating Profit Margin (OPM)
Ulta Beauty Inc., OPM calculation, comparison to benchmarks
| Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 1,347,343) | 1,087,749) | 242,025) | 813,424) | 777,837) | 527,431) | |
| Add: Cash operating taxes2 | 398,271) | 348,456) | 93,598) | 211,391) | 166,502) | 258,720) | |
| Net operating profit before taxes (NOPBT) | 1,745,615) | 1,436,205) | 335,623) | 1,024,815) | 944,339) | 786,151) | |
| Net sales | 10,208,580) | 8,630,889) | 6,151,953) | 7,398,068) | 6,716,615) | 5,884,506) | |
| Add: Increase (decrease) in deferred revenue | 41,098) | 79,196) | 36,848) | 38,481) | 85,918) | —) | |
| Adjusted net sales | 10,249,678) | 8,710,085) | 6,188,801) | 7,436,549) | 6,802,533) | 5,884,506) | |
| Profitability Ratio | |||||||
| OPM3 | 17.03% | 16.49% | 5.42% | 13.78% | 13.88% | 13.36% | |
| Benchmarks | |||||||
| OPM, Competitors4 | |||||||
| Amazon.com Inc. | 7.84% | 0.01% | 9.14% | 7.23% | 6.37% | — | |
| Home Depot Inc. | 15.17% | 15.81% | 14.46% | 14.86% | 14.78% | — | |
| Lowe’s Cos. Inc. | 10.41% | 13.11% | 10.29% | 8.99% | 5.96% | — | |
| TJX Cos. Inc. | 9.87% | 9.95% | 1.83% | 11.34% | 11.40% | — | |
Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2023 Calculation
OPM = 100 × NOPBT ÷ Adjusted net sales
= 100 × 1,745,615 ÷ 10,249,678 = 17.03%
4 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| OPM | The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. | Ulta Beauty Inc. OPM improved from 2021 to 2022 and from 2022 to 2023. |
Turnover of Capital (TO)
Ulta Beauty Inc., TO calculation, comparison to benchmarks
| Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net sales | 10,208,580) | 8,630,889) | 6,151,953) | 7,398,068) | 6,716,615) | 5,884,506) | |
| Add: Increase (decrease) in deferred revenue | 41,098) | 79,196) | 36,848) | 38,481) | 85,918) | —) | |
| Adjusted net sales | 10,249,678) | 8,710,085) | 6,188,801) | 7,436,549) | 6,802,533) | 5,884,506) | |
| Invested capital1 | 4,117,969) | 3,684,509) | 4,184,136) | 3,966,351) | 4,338,625) | 3,940,229) | |
| Efficiency Ratio | |||||||
| TO2 | 2.49 | 2.36 | 1.48 | 1.87 | 1.57 | 1.49 | |
| Benchmarks | |||||||
| TO, Competitors3 | |||||||
| Amazon.com Inc. | 1.77 | 1.92 | 2.33 | 2.58 | 2.21 | — | |
| Home Depot Inc. | 2.85 | 3.15 | 2.66 | 3.01 | 3.17 | — | |
| Lowe’s Cos. Inc. | 3.92 | 3.68 | 3.16 | 2.70 | 2.90 | — | |
| TJX Cos. Inc. | 2.45 | 2.46 | 1.44 | 2.23 | 2.24 | — | |
Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).
1 Invested capital. See details »
2 2023 Calculation
TO = Adjusted net sales ÷ Invested capital
= 10,249,678 ÷ 4,117,969 = 2.49
3 Click competitor name to see calculations.
| Efficiency ratio | Description | The company |
|---|---|---|
| TO | The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. | Ulta Beauty Inc. TO improved from 2021 to 2022 and from 2022 to 2023. |
Effective Cash Tax Rate (CTR)
Ulta Beauty Inc., CTR calculation, comparison to benchmarks
| Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 1,347,343) | 1,087,749) | 242,025) | 813,424) | 777,837) | 527,431) | |
| Add: Cash operating taxes2 | 398,271) | 348,456) | 93,598) | 211,391) | 166,502) | 258,720) | |
| Net operating profit before taxes (NOPBT) | 1,745,615) | 1,436,205) | 335,623) | 1,024,815) | 944,339) | 786,151) | |
| Tax Rate | |||||||
| CTR3 | 22.82% | 24.26% | 27.89% | 20.63% | 17.63% | 32.91% | |
| Benchmarks | |||||||
| CTR, Competitors4 | |||||||
| Amazon.com Inc. | 29.89% | 8,113.11% | 13.08% | 13.72% | 10.59% | — | |
| Home Depot Inc. | 23.63% | 24.46% | 26.23% | 21.74% | 23.25% | — | |
| Lowe’s Cos. Inc. | 30.32% | 22.46% | 23.91% | 21.38% | 33.62% | — | |
| TJX Cos. Inc. | 22.88% | 25.39% | 54.29% | 25.32% | 28.10% | — | |
Based on: 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2023 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 398,271 ÷ 1,745,615 = 22.82%
4 Click competitor name to see calculations.
| Tax rate | Description | The company |
|---|---|---|
| CTR | Effective cash tax rate on operating income. | Ulta Beauty Inc. CTR decreased from 2021 to 2022 and from 2022 to 2023. |