Ubiquiti Inc. (NYSE:UI) boasts a remarkable Return on Invested Capital (ROIC) of 63.47%, significantly outperforming its peers.
The company’s ROIC to Weighted Average Cost of Capital (WACC) ratio is 6.59, indicating efficient capital utilization.
Ubiquiti’s competitors, including Fair Isaac Corporation and Paylocity Holding Corporation, show lower ROIC to WACC ratios, highlighting Ubiquiti’s superior capital efficiency.
Ubiquiti Inc. (NYSE:UI) is a company that specializes in providing networking technology and solutions. It focuses on delivering high-performance networking products and services to a global customer base. Ubiquiti’s offerings include wireless networking products, routers, and switches, catering to both consumer and enterprise markets. The company competes with other technology firms like Fair Isaac Corporation, Paylocity Holding Corporation, Monolithic Power Systems, EPAM Systems, and Insulet Corporation.
In evaluating Ubiquiti’s financial performance, the Return on Invested Capital (ROIC) and Weighted Average Cost of Capital (WACC) are crucial metrics. Ubiquiti boasts a remarkable ROIC of 63.47%, significantly higher than its WACC of 9.64%. This results in a ROIC to WACC ratio of 6.59, indicating that Ubiquiti is generating returns well above its cost of capital, showcasing efficient capital utilization.
When comparing Ubiquiti to its peers, Fair Isaac Corporation (FICO) has a ROIC of 45.08% and a WACC of 10.41%, resulting in a ROIC to WACC ratio of 4.33. Although FICO demonstrates strong capital efficiency, it still falls short of Ubiquiti’s performance. This highlights Ubiquiti’s superior ability to generate returns on its investments.
Other peers like Paylocity Holding Corporation (PCTY) and Monolithic Power Systems, Inc. (MPWR) show lower ROIC to WACC ratios of 0.47 and 1.64, respectively. These figures suggest that these companies are not generating returns as effectively as Ubiquiti. Paylocity’s ROIC of 4.12% is particularly low compared to its WACC of 8.71%, indicating inefficiencies in capital utilization.
EPAM Systems, Inc. (EPAM) and Insulet Corporation (PODD) also trail behind Ubiquiti with ROIC to WACC ratios of 0.97 and 1.93, respectively. EPAM’s ROIC of 10.80% is slightly below its WACC of 11.13%, while Insulet’s ROIC of 18.62% is above its WACC of 9.66%. Despite Insulet’s positive spread, Ubiquiti remains the leader in capital efficiency among its peers.
