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Yahoo
44 minutes ago
- Yahoo
Elevance Health (NYSE:ELV) Is Reinvesting At Lower Rates Of Return
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Amongst other things, we'll want to see two things; firstly, a growing return on capital employed (ROCE) and secondly, an expansion in the company's amount of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. Having said that, from a first glance at Elevance Health (NYSE:ELV) we aren't jumping out of our chairs at how returns are trending, but let's have a deeper look. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. What Is Return On Capital Employed (ROCE)? For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. To calculate this metric for Elevance Health, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.11 = US$8.7b ÷ (US$122b - US$44b) (Based on the trailing twelve months to June 2025). So, Elevance Health has an ROCE of 11%. By itself that's a normal return on capital and it's in line with the industry's average returns of 11%. See our latest analysis for Elevance Health In the above chart we have measured Elevance Health's prior ROCE against its prior performance, but the future is arguably more important. If you'd like, you can check out the forecasts from the analysts covering Elevance Health for free. What Does the ROCE Trend For Elevance Health Tell Us? In terms of Elevance Health's historical ROCE movements, the trend isn't fantastic. Around five years ago the returns on capital were 14%, but since then they've fallen to 11%. Although, given both revenue and the amount of assets employed in the business have increased, it could suggest the company is investing in growth, and the extra capital has led to a short-term reduction in ROCE. And if the increased capital generates additional returns, the business, and thus shareholders, will benefit in the long run. The Bottom Line While returns have fallen for Elevance Health in recent times, we're encouraged to see that sales are growing and that the business is reinvesting in its operations. These trends are starting to be recognized by investors since the stock has delivered a 16% gain to shareholders who've held over the last five years. Therefore we'd recommend looking further into this stock to confirm if it has the makings of a good investment. Elevance Health could be trading at an attractive price in other respects, so you might find our on our platform quite valuable. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
NBC News
an hour ago
- NBC News
Even at 1%, new tax will burden African immigrants who send money back home
A new remittance tax set to begin in the new year has one university student reeling from the implications it will have for her family in Nigeria. Edidiong Chrys, a second-generation Nigerian American, said she thinks the 1% tax passed as part of President Donald Trump's 'big, beautiful bill ' would directly affect the financial lifeline she sends overseas. This tax will be applied to anyone in the U.S. who sends money abroad. 'We regularly send money home to support loved ones, including our elders, children in school, newborns and others in need,' she said. Chrys, 38, said some of the funds sent home have gone to new parents in her family, helping ease the cost of food and traveling to doctors' appointments. The funds also help her uncle, who has a job but also must pay for his five daughters, who are all in school. He and his wife work, but it's still not enough 'to accommodate all the things that need to hold the household down,' Chrys said. And then there's Chrys' 80-year-old grandmother, who was weathering back pain when Chrys visited in January. 'We are paying for the live-in nurse to help her during the week,' she said. 'That's an additional expense that we need to have for her so that she's not bending over.' The tax applies to anyone in the U.S. who sends remittances to their home countries. In 2023, remittances from the U.S. totaled $98 billion, according to the World Bank. Chrys contributes to the $56 billion in remittances sub-Saharan Africa received from people around the world last year. In fact, she said she regularly remits cash — more than 50 times a year — to family and friends. The Center for Global Development, a nonpartisan think tank that focuses on reducing global poverty through economic research, published an analysis last month that listed the tax as yet another financial setback for many nations, given the recent reduction in American aid. Liberia is highly dependent on foreign aid as well as remittances. In 2023, the U.S. accounted for a quarter of the country's foreign aid, and remittances surpassed Liberia's bilateral foreign aid by three times, according to the report. The African Union's outgoing ambassador to the United States, Hilda Suka-Mafudze, said hindering such funding 'threatens to reverse gains in financial inclusion and development across the continent of Africa.' Witney Schneidman, a nonresident senior fellow with the Africa Growth Initiative at the Brookings Institution's Global Economy and Development program, said, 'To put this tax on is just a further constraint on the U.S. effort to work with our partners on the continent.' 'It's not transformational. ... It's just another obstacle to partnership, and it's another obstacle to development,' he said. Schneidman, who also served as deputy assistant secretary of state for African affairs in the Clinton administration, condemned the Trump administration for building barriers and not bridges. 'When you add it up with the visa blockages, with the end of the [African Growth and Opportunity Act] AGOA, with the end of USAID, it's just building a wall,' he said. 'The U.S. is building a wall between itself and the world and certainly between itself and Africa.' Suka-Mafudze, whose focus will turn toward the Southern African Development Community region, said that beyond hurting diplomatic ties, blocking remittances is also 'a human issue, because diaspora remittances are lifelines for millions of African families and these remittances often cover essentials, which are food, school fees, medical care and a lot of things. And to impose a tax on that is deeply unjust.' Chrys said the financial burden of sending money home is already heavy, with some stretching limited resources to make ends meet. 'Some people are not making as much to be able to try to support their family back home,' Chrys said. 'When I do get a chance to send money home, sometimes I'm spending it from my refund check.' Democratic Reps. Sheila Cherfilus-McCormick of Florida and Jonathan L. Jackson of Illinois introduced new legislation called the African Diaspora Investment and Development Act, or AIDA, aimed at reversing the tax's impact. It would also create more transparency in money transfers, among other things. Suka-Mafudze backs the legislation, warning the new tax 'could push people toward informal or unregulated channels, making transactions riskier and less transparent.' Cherfilus-McCormick, the only Haitian American member of Congress right now, warns that a remittance tax would unfairly burden families already struggling to support their loved ones overseas. 'I strongly oppose any effort to tax remittances and will continue fighting for policies that protect immigrant and diaspora communities,' she said in a statement. 'H.R.4586 — AIDA intends to reverse course and instead focus on incentivizing and leveraging on the nearly 100 billion of dollars that Haitian, African and Caribbean Americans send home each year to build sustainable partnerships and strengthen economic development.' Schneidman said the tax has the potential to impact education, health care and families because the bulk of the remittances are family-to-family. That reality is felt most by those sending the money, who see firsthand how even small amounts can make a big difference. 'In the U.S., it might feel like, 'Oh, that's nothing.'' Chrys said. But in Nigeria, 'It's everything because every little money counts.'
Washington Post
an hour ago
- Washington Post
Are we in an AI bubble that's getting ready to pop?
A famous economist once remarked: 'You can see the computer age everywhere but in the productivity statistics.' That epigram, issued by Robert Solow in 1987, became the subject of a lot of debate among economists in the 1990s. You don't hear those arguments so much anymore, because it's clear computers have transformed American work.
