If you're looking for a multi-bagger, there's a few things to keep an eye out for. One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing amount of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. In light of that, when we looked at Eversource Energy (NYSE:ES) and its ROCE trend, we weren't exactly thrilled.
Understanding Return On Capital Employed (ROCE)
Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. The formula for this calculation on Eversource Energy is:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
0.051 = US$2.3b ÷ (US$52b - US$5.5b) (Based on the trailing twelve months to September 2022).
So, Eversource Energy has an ROCE of 5.1%. Even though it's in line with the industry average of 4.6%, it's still a low return by itself.
View our latest analysis for Eversource Energy
![roce](https://usnewsfile.futunn.com/pic/0-17955867-0-48852306d3697394da154e75e12abb34.png/big)
NYSE:ES Return on Capital Employed December 20th 2022
In the above chart we have measured Eversource Energy's prior ROCE against its prior performance, but the future is arguably more important. If you're interested, you can view the analysts predictions in our free report on analyst forecasts for the company.
What The Trend Of ROCE Can Tell Us
In terms of Eversource Energy's historical ROCE trend, it doesn't exactly demand attention. The company has employed 51% more capital in the last five years, and the returns on that capital have remained stable at 5.1%. This poor ROCE doesn't inspire confidence right now, and with the increase in capital employed, it's evident that the business isn't deploying the funds into high return investments.
The Key Takeaway
As we've seen above, Eversource Energy's returns on capital haven't increased but it is reinvesting in the business. Although the market must be expecting these trends to improve because the stock has gained 55% over the last five years. Ultimately, if the underlying trends persist, we wouldn't hold our breath on it being a multi-bagger going forward.
One more thing: We've identified 2 warning signs with Eversource Energy (at least 1 which is a bit concerning) , and understanding them would certainly be useful.
While Eversource Energy isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets.
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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.
如果你正在尋找一個多袋子,有幾個東西需要注意。一種常見的方法是嘗試找到一家擁有退貨已使用資本(ROCE)正在增加,同時也在增長金額已動用資本的比例。基本上,這意味著一家公司有盈利的舉措,可以繼續進行再投資,這是復合機器的一個特點。有鑒於此,當我們看到恆源能源(紐約證券交易所股票代碼:ES)及其ROCE趨勢,我們並不是很興奮。
瞭解資本回報率(ROCE)
如果您不確定,只需澄清一下,ROCE是一種評估公司投資於其業務的資本獲得多少稅前收入(按百分比計算)的指標。Everource Energy的計算公式為:
已動用資本回報率=息稅前收益(EBIT)?(總資產-流動負債)
0.051美元=23億美元(520億美元-55億美元)(基於截至2022年9月的過去12個月).
所以,Everource Energy的淨資產收益率為5.1%。儘管這與4.6%的行業平均水準一致,但這本身仍然是一個低迴報。
查看我們對Everource Energy的最新分析
![roce](https://usnewsfile.futunn.com/pic/0-17955867-0-48852306d3697394da154e75e12abb34.png/big)
紐約證券交易所:ES資本回報率2022年12月20日
在上面的圖表中,我們對比了Eversource Energy之前的ROCE和它之前的表現,但可以說,未來更重要。如果您感興趣,您可以在我們的免費分析師對該公司的預測報告。
ROCE的走勢告訴我們什麼
就Everource Energy歷史上的ROCE趨勢而言,它並不完全需要關注。該公司在過去五年中增聘了51%的資本,這些資本的回報率一直穩定在5.1%。這種糟糕的ROCE目前並沒有激發人們的信心,而且隨著所用資本的增加,很明顯,該公司沒有將資金用於高回報投資。
關鍵的外賣
正如我們在上面看到的,Everource Energy的資本回報率並沒有增加,但它正在對業務進行再投資。儘管市場肯定預計這些趨勢會改善,因為該股在過去五年中上漲了55%。歸根結底,如果潛在的趨勢持續下去,我們不會屏息於它是一個多袋子未來。
還有一件事:我們已經確定了2個警告標誌對於Everource Energy(至少1,這有點令人擔憂),瞭解它們肯定會很有用。
雖然Everource Energy並沒有獲得最高的回報,但看看這個免費資產負債表穩健、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。