Orbital Energy Group Earnings Perspective: Return On Invested Capital

Orbital Energy Group OEG brought in sales totaling $70.25 million during Q1 according to data provided by Benzinga Pro. However, earnings decreased 51.08%, resulting in a loss of $37.62 million. In Q4, Orbital Energy Group brought in $41.05 million in sales but lost $24.90 million in earnings.

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 Q1, Orbital Energy Group posted an ROIC of -0.62%.

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, Orbital Energy Group posted an ROIC of -0.62%.

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 Orbital Energy Group, a negative ROIC ratio of -0.62% suggests that management may not be effectively allocating their capital. Effective capital allocation is a positive indicator that a company will achieve more durable success and favorable long-term returns; poor capital allocation can be a leech on the performance of a company over time.

Upcoming Earnings Estimate

Orbital Energy Group reported Q1 earnings per share at $-0.45/share, which did not meet analyst predictions of $-0.05/share.

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