Return on invested capital
Return on invested capital (also known by its acronym, ROIC) is net operating profit after taxes divided by the operating capital.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Return on invested capital (ROIC). Net operating profit after taxes divided by the operating capital.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Return on invested capital (ROIC). The ratio of after-tax operating income to total invested capital; it measures the total return that the company has provided for its investors.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
