ROIC Analysis

All articles tagged with "ROIC Analysis"

5 articles

DUK 10-K Analysis: The 108-Basis-Point Bet on $200B in Regulated Returns

Duke Energy deployed $14 billion in capital in FY2025 — the most any US regulated utility has ever spent — earning just 108 basis points above its 4.41% borrowing cost. The 10-K reveals a $200-220 billion decade capital plan the earnings release never mentioned. Meanwhile, free cash flow collapsed to -$1.7 billion, O&M costs surged 24% hidden by a fuel cost decline, and $10 billion in planned equity issuance contradicts the 'avoiding dilution' narrative. Four funding sources. One self-cannibalizing growth plan.

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UAL 10-K Analysis: Three Businesses, One Multiple — Why the Market Misprices United

United Airlines generated $59.1 billion in record revenue in FY2025, yet its 7.6% return on invested capital barely clears its 6.2% cost of debt. The 10-K reveals three businesses traveling in three different directions under one ticker: a base airline losing pricing power (PRASM -2.9%), ancillary fees growing at 6.7%, and MileagePlus — now fully unencumbered — surging at 10.3%. At 5.75x EV/EBITDA, the market prices all three as one.

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CVX 10-K Analysis: Why Chevron's 106% Payout Ratio Is a D&A Mirage

Chevron's FY2025 10-K reports a 106% dividend payout ratio — the company paid more in dividends than it earned. But operating cash flow tells the opposite story, covering the dividend 2.6 times. The $73.5 billion Hess PP&E step-up created the widest cash-vs-earnings divergence among supermajors, collapsed ROIC from 9.5% to 5.9%, and transformed Chevron from the least leveraged to the most leveraged in its peer group. Here's what the filing reveals about dividend safety, balance sheet risk, and when the Hess bet might pay off.

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SYK 10-K Analysis: The $1.7B Hidden Cost of Stryker's Acquisition Machine

Stryker just posted its fourth consecutive year of double-digit revenue growth, crossing $25 billion. Operating margins expanded 314 basis points. But the 10-K reveals that $807 million of that expansion is an impairment swing — not operational efficiency. The annual cost of being a serial acquirer totals $1,659 million, exceeding Stryker's entire R&D budget, and all of it is excluded from the adjusted earnings that underpin a 41x multiple. Meanwhile, 68% of pre-tax income flows through international operations generating just 24% of revenue, and the German tax authority has assessed $754 million.

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