Return on Invested Capital

Definition

ROIC. A measure of how effectively a company uses the money (borrowed or owned) invested in its operations. Calculated by: net income after taxes / (total assets less excess cash minus non-interest-bearing liabilities).

Use this term in a sentence

The return on invested capital was there because we needed a way to see how effectively we were using our cash.

​ Was this Helpful? YES  NO 6 people found this helpful.

You should try to make sure that you know what your return on invested capital will be so you know if it is worth pursuing.

​ Was this Helpful? YES  NO 5 people found this helpful.

He realized that his Return on Invested Capital was rather weak because he had let the overhead costs of the new factory overpower the gains he had made.

​ Was this Helpful? YES  NO 3 people found this helpful.

Show more usage examples...

Related Terms

Browse Definitions by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Return on Capital ROC