Verra Mobility Corporation (NASDAQ:VRRM) specializes in smart transportation solutions, offering services like toll and violations management, and title and registration services. The company operates in a competitive landscape with peers such as International Money Express, Inc. (IMXI), Option Care Health, Inc. (OPCH), and R1 RCM Inc. (RCM). These companies, while in different sectors, provide a benchmark for evaluating Verra's financial performance.
Verra Mobility's Return on Invested Capital (ROIC) is 4.72%, which is lower than its Weighted Average Cost of Capital (WACC) of 6.47%. This results in a ROIC to WACC ratio of 0.73, indicating that the company is not generating returns that exceed its cost of capital. This suggests potential inefficiencies in how Verra utilizes its capital to generate returns.
In contrast, International Money Express, Inc. (IMXI) showcases a robust ROIC of 19.70% against a WACC of 7.08%, resulting in a ROIC to WACC ratio of 2.78. This indicates strong capital efficiency and value creation, as highlighted by the significant margin by which its returns exceed its cost of capital.
Option Care Health, Inc. (OPCH) also demonstrates effective capital utilization with a ROIC of 9.30% and a WACC of 6.94%, leading to a ROIC to WACC ratio of 1.34. This positive ratio suggests that OPCH is generating returns above its cost of capital, indicating efficient use of its invested capital.
R1 RCM Inc. (RCM), however, faces challenges similar to Verra Mobility, with a ROIC of 1.33% and a WACC of 7.69%, resulting in a ROIC to WACC ratio of 0.17. This indicates that RCM, like Verra, struggles to generate sufficient returns on its invested capital, highlighting potential areas for improvement in capital management.
