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TransUnion's Return On Invested Capital Overview

According to Benzinga Pro, during Q2, TransUnion (NYSE:TRU) earned $99.70 million, a 92.1% increase from the preceding quarter. TransUnion also posted a total of $948.30 million in sales, a 2.93% increase since Q1.

Benzinga · 07/27/2022 11:27

According to Benzinga Pro, during Q2, TransUnion (NYSE:TRU) earned $99.70 million, a 92.1% increase from the preceding quarter. TransUnion also posted a total of $948.30 million in sales, a 2.93% increase since Q1. TransUnion earned $51.90 million, and sales totaled $921.30 million in Q1.

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 Q2, TransUnion posted an ROIC of 1.35%.

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, TransUnion posted an ROIC of 1.35%.

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 TransUnion, the positive return on invested capital ratio of 1.35% 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

TransUnion reported Q2 earnings per share at $0.98/share, which beat analyst predictions of $0.97/share.

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