FMP
Nov 24, 2024 12:00 PM - Tony Dante(Last modified: Nov 25, 2024 9:27 AM)
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Franklin Covey Co. (NYSE:FC) is a global company specializing in performance improvement. It offers training and consulting services to help organizations achieve results that require a change in human behavior. The company operates in a competitive landscape with peers like CRA International, Inc. (CRAI), Thermon Group Holdings, Inc. (THR), Forrester Research, Inc. (FORR), Forestar Group Inc. (FOR), and Alamo Group Inc. (ALG).
Franklin Covey Co. boasts a remarkable Return on Invested Capital (ROIC) of 46.10%, significantly surpassing its Weighted Average Cost of Capital (WACC) of 10.18%. This results in a ROIC to WACC ratio of 4.53, indicating that the company is generating returns well above its cost of capital. This efficient capital utilization suggests strong value creation for shareholders.
In comparison, CRA International, Inc. (CRAI) has a ROIC of 16.81% and a WACC of 9.16%, leading to a ROIC to WACC ratio of 1.83. While CRAI demonstrates efficient capital use, it still falls short of Franklin Covey's performance. Thermon Group Holdings, Inc. (THR) and Forestar Group Inc. (FOR) have ROIC to WACC ratios below 1, indicating returns that do not cover their cost of capital.
Forrester Research, Inc. (FORR) presents a negative ROIC of -59.12% against a WACC of 7.37%, resulting in a ROIC to WACC ratio of -8.03. This suggests significant challenges in generating returns on investments. Alamo Group Inc. (ALG) has a ROIC to WACC ratio of 1.17, showing moderate efficiency in capital utilization but still lagging behind Franklin Covey.
Overall, Franklin Covey Co. stands out among its peers with its superior ROIC to WACC ratio, reflecting its strong financial performance and effective capital management. This positions NYSE:FC as a potentially attractive investment, given its ability to create value well above its cost of capital.
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