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D’nonce Technology Bhd. (KLSE:DNONCE) Might Not Be A Great Investment – Simply Wall St

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Today we’ll look at D’nonce Technology Bhd. (KLSE:DNONCE) and reflect on its potential as an investment. To be precise, we’ll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.

First, we’ll go over how we calculate ROCE. Next, we’ll compare it to others in its industry. Finally, we’ll look at how its current liabilities affect its ROCE.

What is Return On Capital Employed (ROCE)?

ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. All else being equal, a better business will have a higher ROCE. Ultimately, it is a useful but imperfect metric. Renowned investment researcher Michael Mauboussin has suggested that a high ROCE can indicate that ‘one dollar invested in the company generates value of more than one dollar’.

So, How Do We Calculate ROCE?

Analysts use this formula to calculate return on capital employed:

Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets – Current Liabilities)

Or for D’nonce Technology Bhd:

0.041 = RM4.5m ÷ (RM190m – RM80m) (Based on the trailing twelve months to December 2018.)

Therefore, D’nonce Technology Bhd has an ROCE of 4.1%.

Check out our latest analysis for D’nonce Technology Bhd

Does D’nonce Technology Bhd Have A Good ROCE?

When making comparisons between similar businesses, investors may find ROCE useful. We can see D’nonce Technology Bhd’s ROCE is meaningfully below the Packaging industry average of 9.4%. This performance could be negative if sustained, as it suggests the business may underperform its industry. Regardless of how D’nonce Technology Bhd stacks up against its industry, its ROCE in absolute terms is quite low (especially compared to a bank account). It is likely that there are more attractive prospects out there.

D’nonce Technology Bhd reported an ROCE of 4.1% — better than 3 years ago, when the company didn’t make a profit. That implies the business has been improving. You can click on the image below to see (in greater detail) how D’nonce Technology Bhd’s past growth compares to other companies.

KLSE:DNONCE Past Revenue and Net Income, December 23rd 2019

When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. Companies in cyclical industries can be difficult to understand using ROCE, as returns typically look high during boom times, and low during busts. ROCE is, after all, simply a snap shot of a single year. How cyclical is D’nonce Technology Bhd? You can see for yourself by looking at this free graph of past earnings, revenue and cash flow.

How D’nonce Technology Bhd’s Current Liabilities Impact Its ROCE

Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To counteract this, we check if a company has high current liabilities, relative to its total assets.

D’nonce Technology Bhd has total assets of RM190m and current liabilities of RM80m. As a result, its current liabilities are equal to approximately 42% of its total assets. D’nonce Technology Bhd has a medium level of current liabilities (boosting the ROCE somewhat), and a low ROCE.

Our Take On D’nonce Technology Bhd’s ROCE

So researching other companies may be a better use of your time. You might be able to find a better investment than D’nonce Technology Bhd. If you want a selection of possible winners, check out this free list of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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CI Financial buying US investment adviser Bowling Portfolio Management – BNN

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CI Financial Corp. says it has signed a deal to acquire U.S. investment adviser Bowling Portfolio Management LLC.

The firm based in Cincinnati has US$450 million in assets under management.

Financial terms of the transaction were not disclosed.

Bowling provides financial planning and investment management services to high-net-worth clients.

CI has been expanding its operations in the U.S. this year in a series of acquisitions.

It says when all pending transactions close, it will hold interests in wealth management firms across the U.S. with combined assets of approximately US$11.5 billion.

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Latest COVID-19 research investment supports knowledge exchange on social, cultural and economic impact of COVID-19 – Canada NewsWire

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Research funding will help equip public, private and not-for-profit organizations to respond to challenges posed by pandemic

OTTAWA, ON, Sept. 21, 2020 /CNW/ – As Canada continues to manage the impacts of the COVID-19 pandemic, supporting the work of Canadian researchers is key to building a healthy, more resilient and prosperous country. Working together with government, industry and not-for-profit organizations, researchers from across the social sciences and humanities can help provide data, insight and evidence to guide our actions in the months to come while we navigate postpandemic economic and social recovery.

Today, the Honourable Navdeep Bains, Minister of Innovation, Science and Industry, announced an investment of over $4 million in funding through the Social Sciences and Humanities Research Council‘s (SSHRC) Partnership Engage Grants, to support 172 projects and almost 600 researchers working with businesses and community partners from across Canada. These grants provide short-term and timely support for partnered research activities that will inform decision-making in the public, private or not-for-profit sector.

In response to the early phases of the pandemic crisis, the latest Partnership Engage Grants competition included a special call to address COVID-19 related research. Over $3 million of the investment announced today will directly support 139 projects addressing this call. Some of these projects funded will study changes in the teaching profession, the pandemic’s impact on small- and medium-sized enterprises, mental health among entrepreneurs, and impacts on seniors and their community support services.

Quotes

“The ongoing COVID-19 pandemic has posed unprecedented challenges around the world. While much of the focus to date has been on developing and testing effective countermeasures to control the spread of the virus, the work these researchers will be doing to examine the longer-term impacts of the pandemic on individuals, businesses and communities will better position Canada for a strong recovery.” 
—The Honourable Navdeep Bains, Minister of Innovation, Science and Industry

“SSHRC’s investment in these diverse partnered research projects will advance critical knowledge needed to address the impacts of COVID-19 and the social, cultural and economic challenges facing citizens, communities and businesses in Canada and around the world.”
Ted Hewitt, President, Social Sciences and Humanities Research Council

Quick facts

  • SSHRC’s Partnership Engage Grants provide short-term and timely support for partnered research activities that will inform decision making at a partner organization from the public, private or not-for-profit sector.
  • The Partnership Engage Grants COVID-19 Special Initiative provides researchers and their partners a unique opportunity to foster knowledge exchange on COVID-19 crisis-related issues, challenges and impacts. It offers a unique opportunity to exchange knowledge between postsecondary researchers and different sectors of society, including graduate students, postdoctoral researchers and other highly qualified personnel.
  • The Partnership Engage Grants COVID-19 Special Initiative call is ongoing. Recipients of the September-deadline applications will be announced soon.
  • The application intake for this first ever COVID-19 Special Initiative competition exceeded expectations. To ensure an appropriate response to this demand, SSHRC reallocated just over $3 million more to this initiative. This additional funding brings the total amount for the June and upcoming September competitions to almost $5 million.

Associated links

Follow SSHRC on social media: Twitter, Instagram, Facebook

Follow @CDNScience on social media: Twitter, Instagram, Facebook

SOURCE Social Sciences and Humanities Research Council of Canada

For further information: John Power, Press Secretary, Office of the Minister of Innovation, Science and Industry, 343-550-1456, [email protected]; Media Relations, Innovation, Science and Economic Development Canada, 343-291-1777, [email protected]; Media Relations, Social Sciences and Humanities Research Council, 343-549-6141, [email protected]

Related Links

http://www.sshrc-crsh.gc.ca/

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CI Financial buying U.S. investment adviser Bowling Portfolio Management – Vancouver Courier

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TORONTO — CI Financial Corp. says it has signed a deal to acquire U.S. investment adviser Bowling Portfolio Management LLC.

The firm based in Cincinnati has US$450 million in assets under management.

article continues below

Financial terms of the transaction were not disclosed.

Bowling provides financial planning and investment management services to high-net-worth clients.

CI has been expanding its operations in the U.S. this year in a series of acquisitions.

It says when all pending transactions close, it will hold interests in wealth management firms across the U.S. with combined assets of approximately US$11.5 billion.

This report by The Canadian Press was first published Sept. 21, 2020.

Companies in this story: (TSX:CIX)

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