Premier's Return on Invested Capital Overview

According to Benzinga Pro, during Q3, Premier PINC earned $39.07 million, a 49.41% increase from the preceding quarter. Premier's sales decreased to $347.83 million, a 8.28% change since Q2. In Q2, Premier earned $77.23 million, and total sales reached $379.21 million.

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 Q3, Premier posted an ROIC of 2.02%.

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 Q3, Premier posted an ROIC of 2.02%.

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 Premier, the positive return on invested capital ratio of 2.02% 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

Premier reported Q3 earnings per share at $0.57/share, which did not meet analyst predictions of $0.58/share.

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