Looking Into CarParts.com's Return On Invested Capital

According to Benzinga Pro, during Q2, CarParts.com PRTS earned $2.34 million, a 193.51% increase from the preceding quarter. CarParts.com also posted a total of $157.54 million in sales, a 8.79% increase since Q1. CarParts.com collected $144.80 million in revenue during Q1, but reported earnings showed a $2.50 million loss.

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 Q2, CarParts.com posted an ROIC of 2.48%.

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 Q2, CarParts.com posted an ROIC of 2.48%.

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 CarParts.com, the positive return on invested capital ratio of 2.48% 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

CarParts.com reported Q2 earnings per share at $0.04/share, which beat analyst predictions of $-0.04/share.