Looking Into GAN's Return On Invested Capital

According to data from Benzinga Pro, during Q1, GAN's GAN reported sales totaled $37.49 million. Despite a 70.94% increase in earnings, the company posted a loss of $4.50 million. GAN collected $30.48 million in revenue during Q4, but reported earnings showed a $15.48 million loss.

What Is ROIC?

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC 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 ROIC suggests the opposite. In Q1, GAN posted an ROIC of -1.41%.

Keep in mind, while ROIC 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.

Return on Invested Capital is a measure of yearly pre-tax profit relative to capital invested by a business. Changes in earnings and sales indicate shifts in a company's ROIC. A higher ROIC 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 ROIC suggests the opposite. In Q1, GAN posted an ROIC of -1.41%.

Keep in mind, while ROIC 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 GAN, a negative ROIC ratio of -1.41% 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.

Upcoming Earnings Estimate

GAN reported Q1 earnings per share at $-0.08/share, which beat analyst predictions of $-0.1/share.

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