Return On Capital Employed insights from DermTech
the company posted a loss of $29.58 million. DermTech generated $3.72 million in sales but lost $30.11 million in earnings in Q1.
A higher ROCE indicates a company's success in growing and a future with higher earnings per share
Capital allocation effectiveness can be compared using OCE for similar companies
This money can be reinvested in more capital, resulting in higher returns and, ultimately, higher earnings per share (EPS).
An ROCE ratio of -0.17% for DermTech indicates inefficient capital allocation by management.
A company's ability to allocate capital effectively is an indicator of its long-term success and profitability
A company's performance can be adversely affected by poor capital allocation
DermTech reported Q2 earnings per share of $-0.99, beating analyst expectations of $-1.01/share
Further, ROCE does not serve as a predictive tool since it evaluates past performance