ROIC Data: DFO code vs. Eikon Code
Dear community,
Historically when pulling ROIC data through Datastream we would use the code WC08376 for Worldscope Fundamentals. We were made aware that Worldscope is not available on the Eikon API.
What is the best Eikon Code to get the standard definition of ROIC as described below:
Return On Invested Capital
All Industries:
(Net Income – Bottom Line + ((Interest Expense on Debt - Interest Capitalized) * (1-Tax Rate))) / Average of Last Year's and Current Year’s (Total Capital + Short Term Debt & Current Portion of Long Term Debt) * 100
We have tested pulling TR.ROICActValue, but the values we get are very different.
Hi @Erik77 our calculation for ROIC can be seen on the data item browser below:
From what I can see the industry standard calculation is as follows:
TR.ROICActValue = Net Operating Profit - Adjusted Taxes / Invested Capital
Note this is the basis on which brokers are reporting their estimates - so i would say that this is the industry standard accounting identity.
This is obviously different from the calculation you require. I think you would have to compute this yourself using the underlying data required for the calculation. The fields required for your calculation:
Net Income – Bottom Line: TR.InvtrNetIncome (I would suggest you use this field instead TR.F.IncAvailToComShr(Period=FY0) as it comes from the same fundamentals content set)
Interest Expense on Debt - Interest Capitalized: TR.F.IntrExpnNetOfCapIntr(Period=FY0)
Total Capital: TR.F.TotCap(Period=FY-1), TR.F.TotCap(Period=FY0)
Short Term Debt & Current Portion of Long Term Debt: TR.F.STDebtCurrPortOfLTDebt(Period=FY-1), TR.F.STDebtCurrPortOfLTDebt(Period=FY0)
Tax Rate: TR.F.EstTaxRate(Period=FY0)
You can then just download these:
df,err = ek.get_data('VOD.L',['TR.F.IncAvailToComShr(Period=FY0)','TR.F.IntrExpnNetOfCapIntr(Period=FY0)','TR.F.TotCap(Period=FY-1)','TR.F.TotCap(Period=FY0)','TR.F.STDebtCurrPortOfLTDebt(Period=FY-1)','TR.F.STDebtCurrPortOfLTDebt(Period=FY0)','TR.F.EstTaxRate(Period=FY0)'])
df
and plug in those to your formula.
I hope this can help.