Microsoft Excel LibreOffice Calc

Emerson Electric Co. (NYSE:EMR)

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Return on Capital (ROC)

Advanced level

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)

Emerson Electric Co., ROIC calculation

Microsoft Excel LibreOffice Calc
Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015 Sep 30, 2014
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1
Invested capital2
Performance Ratio
ROIC3

Based on: 10-K (filing date: 2019-11-18), 10-K (filing date: 2018-11-19), 10-K (filing date: 2017-11-20), 10-K (filing date: 2016-11-16), 10-K (filing date: 2015-11-18), 10-K (filing date: 2014-11-19).

1 NOPAT. See details »

2 Invested capital. See details »

3 2019 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × ÷ =

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Emerson Electric Co.’s ROIC improved from 2017 to 2018 and from 2018 to 2019.

Decomposition of ROIC

Emerson Electric Co., decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
Sep 30, 2019 = × ×
Sep 30, 2018 = × ×
Sep 30, 2017 = × ×
Sep 30, 2016 = × ×
Sep 30, 2015 = × ×
Sep 30, 2014 = × ×

Based on: 10-K (filing date: 2019-11-18), 10-K (filing date: 2018-11-19), 10-K (filing date: 2017-11-20), 10-K (filing date: 2016-11-16), 10-K (filing date: 2015-11-18), 10-K (filing date: 2014-11-19).

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 2019 year is the decrease in effective cash tax rate (CTR).


Operating Profit Margin (OPM)

Emerson Electric Co., OPM calculation

Microsoft Excel LibreOffice Calc
Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015 Sep 30, 2014
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1
Add: Cash operating taxes2
Net operating profit before taxes (NOPBT)
 
Net sales
Profitability Ratio
OPM3

Based on: 10-K (filing date: 2019-11-18), 10-K (filing date: 2018-11-19), 10-K (filing date: 2017-11-20), 10-K (filing date: 2016-11-16), 10-K (filing date: 2015-11-18), 10-K (filing date: 2014-11-19).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2019 Calculation
OPM = 100 × NOPBT ÷ Net sales
= 100 × ÷ =

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. Emerson Electric Co.’s OPM deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Turnover of Capital (TO)

Emerson Electric Co., TO calculation

Microsoft Excel LibreOffice Calc
Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015 Sep 30, 2014
Selected Financial Data (US$ in millions)
Net sales
Invested capital1
Efficiency Ratio
TO2

Based on: 10-K (filing date: 2019-11-18), 10-K (filing date: 2018-11-19), 10-K (filing date: 2017-11-20), 10-K (filing date: 2016-11-16), 10-K (filing date: 2015-11-18), 10-K (filing date: 2014-11-19).

1 Invested capital. See details »

2 2019 Calculation
TO = Net sales ÷ Invested capital
= ÷ =

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. Emerson Electric Co.’s TO improved from 2017 to 2018 and from 2018 to 2019.

Effective Cash Tax Rate (CTR)

Emerson Electric Co., CTR calculation

Microsoft Excel LibreOffice Calc
Sep 30, 2019 Sep 30, 2018 Sep 30, 2017 Sep 30, 2016 Sep 30, 2015 Sep 30, 2014
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

Based on: 10-K (filing date: 2019-11-18), 10-K (filing date: 2018-11-19), 10-K (filing date: 2017-11-20), 10-K (filing date: 2016-11-16), 10-K (filing date: 2015-11-18), 10-K (filing date: 2014-11-19).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2019 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × ÷ =

Tax rate Description The company
CTR Effective cash tax rate on operating income. Emerson Electric Co.’s CTR decreased from 2017 to 2018 and from 2018 to 2019.