(Solution) - What is expected return on invested capital EROIC Why is the -(2025 Original AI-Free Solution)

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What is expected return on invested capital (EROIC)? Why is the spread between EROIC and WACC so important?
You have been hired as a consultant to Kulpa Fishing Supplies (KFS), a company that is seeking to increase its value. The company?s CEO and founder, Mia Kulpa, has asked you to estimate the value of two privately held companies that KFS is considering acquiring. But first, the senior management of KFS would like for you to explain how to value companies that don?t pay any dividends.