Looking Into CVR Energy's Return On Invested Capital

Pulled from Benzinga Pro data, CVR Energy CVI showed a loss in earnings since Q3, totaling $25.00 million. Sales, on the other hand, increased by 12.16% to $2.11 billion during Q4. In Q3, CVR Energy earned $106.00 million and total sales reached $1.88 billion.

What Is ROIC?

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q4, CVR Energy posted an ROIC of 8.05%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROIC suggests the opposite. In Q4, CVR Energy posted an ROIC of 8.05%.

Keep in mind, while ROIC is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

For CVR Energy, the positive return on invested capital ratio of 8.05% suggests that management is allocating their capital effectively. Effective capital allocation is a positive indicator that a company will achieve more durable success and favorable long-term returns.

Upcoming Earnings Estimate

CVR Energy reported Q4 earnings per share at $-0.2/share, which did not meet analyst predictions of $0.06/share.

This article was generated by Benzinga's automated content engine and reviewed by an editor.