Benzinga Pro data, Chimera Investment (NYSE:CIM) reported Q1 sales of $137.70 million. Earnings fell to a loss of $262.79 million, resulting in a 1581.87% decrease from last quarter. Chimera Investment earned $17.73 million, and sales totaled $154.56 million in Q4.

What Is ROCE?

Return on Capital Employed is a measure of yearly pre-tax profit relative to capital employed by a business. Changes in earnings and sales indicate shifts in a company's ROCE. A higher ROCE is generally representative of successful growth of a company and is a sign of higher earnings per share in the future. A low or negative ROCE suggests the opposite. In Q1, Chimera Investment posted an ROCE of -0.08%.

Keep in mind, while ROCE is a good measure of a company's recent performance, it is not a highly reliable predictor of a company's earnings or sales in the near future.

For Chimera Investment, a negative ROCE ratio of -0.08% suggests that management may not be effectively allocating their capital. Effective capital allocation is a positive indicator that a company will achieve more durable success and favorable long-term returns; poor capital allocation can be a leech on the performance of a company over time.

Analyst Predictions

Chimera Investment reported Q1 earnings per share at $0.39/share, which beat analyst predictions of $0.37/share.

This article was generated by Benzinga's automated content engine and reviewed by an editor.