Antero resources (NYSE:WITH) recorded a drop in earnings of 120.16% in the third quarter. However, revenue increased 243.94% from the previous quarter to $ 1.31 billion. Despite the increase in revenue for the quarter, the decline in earnings could indicate that Antero Resources is not using its capital as effectively as possible. In the third quarter, Antero Resources had revenues of $ 380.59 million but lost profits of $ 754.63 million.
What is the return on investment?
Changes in earnings and sales indicate shifts in the return on investment of Antero Resources, a measure of the annual pre-tax profit relative to the capital employed by a company. In general, a higher ROCE indicates successful growth for a company and is a sign of higher earnings per share in the future. In the fourth quarter, Antero Resources achieved a ROCE of 0.02%.
It is important to note that ROCE measures past performance and is not used as a forecasting tool. It’s a good measure of a company’s recent performance, but several factors could affect earnings and sales in the near future.
Return on investment is an important measure of efficiency and a useful tool for comparing companies in the same industry. A relatively high ROCE indicates that a company may generate profits that can be reinvested in more capital, resulting in higher returns and growing earnings per share for shareholders.
In the case of Antero Resources, positive ROCE will be something that investors need to look out for before making long-term financial decisions.
Q4 earnings insight
Antero Resources reported earnings per share of $ -0.03 / share for the fourth quarter, which was not in line with analysts’ guidance of $ 0.06 / share.
