What trends should we look for it we want to identify stocks that can multiply in value over the long term? In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. So when we looked at the ROCE trend of Sichuan Shengda Forestry Industry (SZSE:002259) we really liked what we saw.
Return On Capital Employed (ROCE): What Is It?
For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. To calculate this metric for Sichuan Shengda Forestry Industry, this is the formula:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
0.21 = CN¥66m ÷ (CN¥1.0b - CN¥720m) (Based on the trailing twelve months to September 2022).
Therefore, Sichuan Shengda Forestry Industry has an ROCE of 21%. In absolute terms that's a great return and it's even better than the Oil and Gas industry average of 15%.
View our latest analysis for Sichuan Shengda Forestry Industry
![roce](https://usnewsfile.futunn.com/pic/0-17823773-0-352a9c5f96fb34c5e64d0a5405343b63.png/big)
SZSE:002259 Return on Capital Employed December 15th 2022
While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you'd like to look at how Sichuan Shengda Forestry Industry has performed in the past in other metrics, you can view this free graph of past earnings, revenue and cash flow.
What Does the ROCE Trend For Sichuan Shengda Forestry Industry Tell Us?
You'd find it hard not to be impressed with the ROCE trend at Sichuan Shengda Forestry Industry. The figures show that over the last five years, returns on capital have grown by 695%. That's a very favorable trend because this means that the company is earning more per dollar of capital that's being employed. In regards to capital employed, Sichuan Shengda Forestry Industry appears to been achieving more with less, since the business is using 86% less capital to run its operation. If this trend continues, the business might be getting more efficient but it's shrinking in terms of total assets.
For the record though, there was a noticeable increase in the company's current liabilities over the period, so we would attribute some of the ROCE growth to that. Effectively this means that suppliers or short-term creditors are now funding 70% of the business, which is more than it was five years ago. Given it's pretty high ratio, we'd remind investors that having current liabilities at those levels can bring about some risks in certain businesses.
Our Take On Sichuan Shengda Forestry Industry's ROCE
In a nutshell, we're pleased to see that Sichuan Shengda Forestry Industry has been able to generate higher returns from less capital. And since the stock has fallen 48% over the last five years, there might be an opportunity here. With that in mind, we believe the promising trends warrant this stock for further investigation.
While Sichuan Shengda Forestry Industry looks impressive, no company is worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether 002259 is currently trading for a fair price.
Sichuan Shengda Forestry Industry is not the only stock earning high returns. If you'd like to see more, check out our free list of companies earning high returns on equity with solid fundamentals.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
我們應該尋找什麼樣的趨勢,我們想要找出能夠長期成倍增值的股票?在一個完美的世界裡,我們希望看到一家公司向其業務投入更多資本,理想情況下,從這些資本中賺取的回報也在增加。歸根結底,這表明它是一家正在以越來越高的回報率對利潤進行再投資的企業。因此,當我們觀察ROCE的趨勢時四川盛達森工(SZSE:002259)我們真的很喜歡我們所看到的。
資本回報率(ROCE):它是什麼?
對於那些不知道的人來說,ROCE是一家公司的年度稅前利潤(其回報)相對於業務資本的衡量標準。要計算四川盛達森工的這一指標,公式如下:
已動用資本回報率=息稅前收益(EBIT)?(總資產-流動負債)
0.21=CN元6600萬?(CN元10億元-CN元7.2億元)(基於截至2022年9月的過去12個月).
所以呢,四川盛達森工的淨資產收益率為21%。按絕對值計算,這是一個很高的回報率,甚至好於石油和天然氣行業15%的平均水準。
查看我們對四川盛達林業的最新分析
![roce](https://usnewsfile.futunn.com/pic/0-17823773-0-352a9c5f96fb34c5e64d0a5405343b63.png/big)
深圳證券交易所:002259 2022年12月15日的資本回報率
雖然過去並不代表未來,但瞭解一家公司歷史上的表現是有幫助的,這就是為什麼我們有上面的圖表。如果你想看看四川盛達林業過去在其他指標上的表現,你可以查看以下內容免費過去收益、收入和現金流的圖表。
四川盛達森工的ROCE趨勢告訴我們什麼?
你會發現很難不對四川盛達森工的ROCE趨勢印象深刻。數據顯示,在過去五年中,資本回報率增長了695%。這是一個非常有利的趨勢,因為這意味著公司每使用一美元資本就能賺到更多的錢。在資本投入方面,四川盛達森工似乎正在以更少的成本獲得更多的收益,因為該企業運營所用的資本減少了86%。如果這種趨勢繼續下去,業務可能會變得更有效率,但總資產正在縮水。
不過,根據記錄,在此期間,該公司的流動負債明顯增加,因此我們將ROCE的增長部分歸因於此。實際上,這意味著供應商或短期債權人現在為該業務提供了70%的資金,這一比例高於五年前。鑑於這一比率相當高,我們要提醒投資者,流動負債處於這樣的水準可能會給某些業務帶來一些風險。
我們對四川盛達森工的ROCE的看法
總而言之,我們很高興看到四川盛達森工能夠用更少的資本產生更高的回報。由於該公司股價在過去五年中下跌了48%,這裡可能存在機會。考慮到這一點,我們認為前景看好的趨勢需要對這只股票進行進一步的調查。
雖然四川盛達林業看起來令人印象深刻,但沒有一家公司值無限的價格。我們的內部價值資訊圖免費研究報告有助於直觀地瞭解002259目前的交易價格是否合理。
四川盛達森工並不是唯一一隻獲得高回報的股票。如果您想了解更多,請查看我們的免費基本面穩固、股本回報率高的公司名單。
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本文由Simply Wall St.撰寫,具有概括性。我們僅使用不偏不倚的方法提供基於歷史數據和分析師預測的評論,我們的文章並不打算作為財務建議。它不構成買賣任何股票的建議,也沒有考慮你的目標或你的財務狀況。我們的目標是為您帶來由基本面數據驅動的長期重點分析。請注意,我們的分析可能不會將最新的對價格敏感的公司公告或定性材料考慮在內。Simply Wall St.對上述任何一隻股票都沒有持倉。