Common Shareholder’s & Creditor’s Portion of ROIC

Subject : Common Shareholder’s & Creditor’s Portion of ROIC

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Common Shareholder’s Portion of ROIC

= [ 1/(1 + D/E) ] × ROIC

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Creditor’s Portion of ROIC

= [ D/E ÷ (1 + D/E) ] × ROIC

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The Concept is logically true.

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But do you agree?

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Why do you agree or disagree?

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If a stock’s intrinsic value is a mathematical function involving ROIC, which “ROIC” shall be used by Common Shareholders, Creditors and Non-Common Shareholders Nor Creditors?

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Kindly provide your professional financial and accounting advice.

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Thanks