Return on Capital Employed Overview: Lantheus Holdings

After pulling data from Benzinga Pro it seems like during Q2, Lantheus Holdings LNTH brought in sales totaling $101.06 million. However, earnings decreased 7559.89%, resulting in a loss of $26.78 million. Lantheus Holdings earned $359.00 thousand, and sales totaled $92.51 million in Q1.

What Is Return On Capital Employed?

Changes in earnings and sales indicate shifts in Lantheus Holdings's Return on Capital Employed, a measure of yearly pre-tax profit relative to capital employed by a business. Generally, a higher ROCE suggests successful growth of a company and is a sign of higher earnings per share in the future. In Q2, Lantheus Holdings posted an ROCE of -0.05%.

It is important to keep in mind ROCE evaluates past performance and is not used as a predictive tool. It is a good measure of a company's recent performance, but several factors could affect earnings and sales in the near future.

ROCE is an important metric for the comparison of similar companies. A relatively high ROCE shows Lantheus Holdings is potentially operating at a higher level of efficiency than other companies in its industry. If the company is generating high profits with its current level of capital, some of that money can be reinvested in more capital which will generally lead to higher returns and earnings per share growth.

For Lantheus Holdings, the return on capital employed ratio shows the current amount of assets may not actually be helping the company achieve higher returns, a note many investors will take into account when making long-term financial decisions.

Upcoming Earnings Estimate

Lantheus Holdings reported Q2 earnings per share at $0.11/share, which beat analyst predictions of $0.05/share.