Looking Into Northwest Natural Holding's Return On Invested Capital

According to Benzinga Pro, during Q1, Northwest Natural Holding NWN earned $56.24 million, a 38.77% increase from the preceding quarter. Northwest Natural Holding also posted a total of $350.30 million in sales, a 19.11% increase since Q4. Northwest Natural Holding earned $40.53 million, and sales totaled $294.09 million in Q4.

Why Is ROIC Significant?

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 Q1, Northwest Natural Holding posted an ROIC of 3.7%.

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 Q1, Northwest Natural Holding posted an ROIC of 3.7%.

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 Northwest Natural Holding, the positive return on invested capital ratio of 3.7% 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.

Analyst Predictions

Northwest Natural Holding reported Q1 earnings per share at $1.8/share, which did not meet analyst predictions of $1.91/share.

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