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Green Brick Partners's Return On Capital Employed Overview

By Benzinga Insights

Pulled from Benzinga Pro data, Green Brick Partners (NASDAQ:GRBK) posted Q1 earnings of $64.20 million, an increase from Q4 of 4.3%. Sales dropped to $393.62 million, a 12.97% decrease between quarters. Green Brick Partners earned $67.08 million, and sales totaled $452.25 million in Q4.

What Is Return On Capital Employed?

Earnings data without context is not clear and can be difficult to base trading decisions on. Return on Capital Employed (ROCE) helps to filter signal from noise by measuring yearly pre-tax profit relative to capital employed by a business. Generally, a higher ROCE suggests successful growth of a company and is a sign of higher earnings per share in the future. In Q1, Green Brick Partners posted an ROCE of 0.07%.

It is important to keep in mind that ROCE evaluates past performance and is not used as a predictive tool. It is a good measure of a company's recent performance, but does not account for factors that could affect earnings and sales in the near future.

ROCE is a powerful metric for comparing the effectiveness of capital allocation for similar companies. A relatively high ROCE shows Green Brick Partners is potentially operating at a higher level of efficiency than other companies in its industry. If the company is generating high profits with its current level of capital, some of that money can be reinvested in more capital which will generally lead to higher returns and, ultimately, earnings per share (EPS) growth.

For Green Brick Partners, the positive return on capital employed ratio of 0.07% 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

Green Brick Partners reported Q1 earnings per share at $1.2/share, which beat analyst predictions of $0.85/share.

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

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Dive Deeper:
USA Compression Partners's Return On Capital Employed Overview
According to Benzinga Pro, during Q1, USA Compression Partners (NYSE:USAC) earned $3.25 million, a 4.8% increase from the preceding quarter.…
Krispy Kreme's Return On Capital Employed Overview
According to Benzinga Pro, during Q1, Krispy Kreme (NASDAQ:DNUT) earned $6.46 million, a 50.78% increase from the preceding quarter. Krispy…
LGI Homes's Return On Capital Employed Overview
Pulled from Benzinga Pro data, LGI Homes (NASDAQ:LGIH) posted Q1 earnings of $78.69 million, an increase from Q4 of 29.3%.…
Enova International's Return On Capital Employed Overview
According to Benzinga Pro, during Q1, Enova International (NYSE:ENVA) earned $52.44 million, a 7.6% increase from the preceding quarter. Enova…
One subscription that gives you access to news from hundreds of sites
Resideo Technologies's Return On Capital Employed Overview
According to Benzinga Pro, during Q1, Resideo Technologies (NYSE:REZI) earned $87.00 million, a 29.85% increase from the preceding quarter. Resideo…
Viant Technology's Return On Capital Employed Overview
Benzinga Pro data, Viant Technology (NASDAQ:DSP) reported Q1 sales of $42.63 million. Earnings fell to a loss of $13.56 million,…
Get all your news in one place