UMB Financial Corporation's Capital Efficiency Compared to Peers
Kansas City, Missouri - UMB Financial Corporation (NASDAQ:UMBF) has a Return on Invested Capital (ROIC) to Weighted Average Cost of Capital (WACC) ratio of 0.56. This metric indicates that the financial services holding company's returns are lower than its cost of capital.
UMB Financial Corporation reported a ROIC of 9.12% and a WACC of 16.28%. The resulting 0.56 ratio suggests there is room for improvement in its capital efficiency.
Among its peers, Wintrust Financial Corporation achieved the highest ROIC to WACC ratio at 0.74. This performance was driven by a 10.46% ROIC and a 14.08% WACC.
Commerce Bancshares matched UMBF's ratio of 0.56, with a ROIC of 4.49% and a WACC of 7.97%. United Bankshares recorded a ratio of 0.45, based on a 6.59% ROIC and 14.68% WACC. Trustmark Corporation had a ratio of 0.39, with a 6.25% ROIC and 15.88% WACC.
Westamerica Bancorporation reported the lowest ROIC to WACC ratio at 0.29, stemming from a 1.99% ROIC and a 6.80% WACC. The comparative analysis underscores the importance of optimizing returns relative to the cost of capital in the financial sector.
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