Did you know that there are some financial metrics that can provide clues to potential multi-baggers? In a perfect world, companies would invest more capital in their businesses, and ideally, more revenue from that capital. I hope to When you see this, it usually means a company with a good business model and plenty of profitable reinvestment opportunities. With that in mind, ROCE Societe BIC (EPA:BB) It looks great, so let’s see what the trends tell us.
Understanding Return on Capital Employed (ROCE)
For those who don’t know what ROCE is, it measures the amount of pre-tax profit a company can generate from the capital it uses in its operations. The formula for this in Société BIC is:
Return on Capital Employed = Earnings Before Interest and Taxes (EBIT) ÷ (Total Assets – Current Liabilities)
0.40 = €810 million ÷ (€2.8 billion – €751 million) (Based on the last 12 months to September 2022).
therefore, Société BIC has a ROCE of 40%. This is an impressive return, and not only that, it beats the 9.7% average for its peers.
See the latest analysis from Société BIC.
In the chart above you can see Societe BIC’s current ROCE compared to its previous return on capital, but we don’t know much from the past. If you want, you can find the analyst’s forecasts covering Societe BIC here. freedom.
What can Société BIC’s ROCE trends tell us?
Société BIC is not disappointed with ROCE’s growth. More specifically, the company has held its capital employed relatively flat over the past five years, while ROCE has seen him rise 108% over the same period. Therefore, the business may be fully reaping the benefits of its past investments as the capital used has not changed significantly. In that sense, the company is doing well, and it’s worth investigating what management plans for its long-term growth prospects.
Société BIC ROCE Conclusion
To tie it all together, Societe BIC has managed to increase the profit it makes on the capital it uses. The stock has fallen 19% over the past five years, so there may be an opportunity here. If so, a survey of the company’s current metrics and future prospects seems appropriate.
On another note, we found Two warning signs of the Société BIC you probably want to know.
Société BIC is not the only high-profit company.Check us out if you want to see more freedom List of companies with solid fundamentals and strong return on equity.
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This article by Simply Wall St is general in nature. We provide comments based on historical data and analyst projections using only unbiased methodologies and our articles are not intended as financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. We aim to deliver long-term focused analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Is not …
