Target Hospitality Earnings Perspective: Return On Invested Capital

Pulled from Benzinga Pro data, Target Hospitality TH posted Q1 earnings of $494.00 thousand, an increase from Q4 of 82.35%. Sales dropped to $80.33 million, a 1.66% decrease between quarters. In Q4, Target Hospitality earned $2.80 million, and total sales reached $81.69 million.

What Is Return On Invested Capital?

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, Target Hospitality posted an ROIC of 2.78%.

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, Target Hospitality posted an ROIC of 2.78%.

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 Target Hospitality, the positive return on invested capital ratio of 2.78% 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

Target Hospitality reported Q1 earnings per share at $0.01/share, which did not meet analyst predictions of $0.01/share.

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