Return on capital employed (ROCE) is the ratio of net operating profit of a company to its capital employed. It measures the profitability of a company by expressing its operating profit as a percentage of its capital employed. Capital employed is the sum of stockholders' equity and long-term...
Accordingly, Scott’s return on capital employed would be calculated like this: As you can see, Scott has a return of 1.33. In other words, every dollar invested in employed capital, Scott earns $1.33. Scott’s return might be so high because he maintains low assets level. Companies with ...
Definition Return on capital employed (ROCE) is a measure of the returns that a business is achieving from the capital employed, usually expressed in percentage terms. Capital employed equals a company's Equity plus...
Return on average capital employed (ROACE) is a financial ratio that shows profitability versus the investments a company has made in itself.
Return on Invested Capital (ROIC)Return on Equity (ROE)Return on Assets (ROA)Return on Investment (ROI)Return on Capital Employed (ROCE)Invested Capital (IC)DuPont AnalysisReturn on Sales (ROS)Equity MultiplierEconomic Profit Capital Allocation Ratios Return on Net Assets (RONA)Return on Ad ...
used by analysts. It is commonly used in conjunction withearnings before interest and tax (EBIT)in the return on capital employed (ROCE) ratio. As will be explained below, ROCE is a commonly used ratio by analysts for assessing the profitability of a company for the amount of capital used....
Disclaimer:The contents of this article are for informational and entertainment purposes only and should not be construed as financial advice or recommendations to buy or sell any securities. What's More? Inventory to Sales Ratio Return on Capital Employed Ratio ...
Capital Efficiency Core Concepts Return on Invested Capital (ROIC)Return on Equity (ROE)Return on Assets (ROA)Return on Investment (ROI)Return on Capital Employed (ROCE)Invested Capital (IC)DuPont AnalysisReturn on Sales (ROS)Equity MultiplierEconomic Profit Capital Allocation Ratios Return on ...
Return on Capital Employed = Net Income / Capital Employed Read a detailed write-up aboutRETURN ON CAPITAL EMPLOYEDhere. Return on Investment (ROI) ROI is a very useful tool for evaluating investments. It compares the profits earned from investments with the cost incurred on these investments. ...
profits before interest to a 12%return on capital employed (ROCE), the remaining profit after paying the interest is $78,000, which will increase equity by more than 50%, assuming the profit generated gets reinvested back. As we can see, the effect of debt is to m...