Grenergy Renovables

Why We Like Grenergy Renovables, S.A.’s (BME:GRE) 20% Return On Capital Employed
Today we are going to look at Grenergy Renovables, S.A. (BME:GRE) to see whether it might be an attractive investment prospect. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.
First of all, we'll work out how to calculate ROCE. Second, we'll look at its ROCE compared to similar companies. Last but not least, we'll look at what impact its current liabilities have on its ROCE.
Return On Capital Employed (ROCE): What is it?
ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Renowned investment researcher Michael Mauboussin has suggested that a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
How Do You Calculate Return On Capital Employed?
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Grenergy Renovables:
0.20 = €12m ÷ (€110m - €47m) (Based on the trailing twelve months to June 2019.)
Therefore, Grenergy Renovables has an ROCE of 20%.
Check out our latest analysis for Grenergy Renovables
Does Grenergy Renovables Have A Good ROCE?


finance.yahoo.com

Why We Like Grenergy Renovables, S.A.’s (BME:GRE) 20% Return On Capital Employed

Today we are going to look at Grenergy Renovables, S.A. (BME:GRE) to see whether it might be an attractive investment...
finance.yahoo.com finance.yahoo.com
 
Here’s What Grenergy Renovables, S.A.’s (BME:GRE) ROCE Can Tell Us
Simply Wall St February 17, 2020
Today we’ll evaluate Grenergy Renovables, S.A. (BME:GRE) to determine whether it could have potential as an investment idea. Specifically, we’re going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business.

Firstly, we’ll go over how we calculate ROCE. Next, we’ll compare it to others in its industry. Then we’ll determine how its current liabilities are affecting its ROCE.

Understanding Return On Capital Employed (ROCE)
ROCE measures the ‘return’ (pre-tax profit) a company generates from capital employed in its business. Generally speaking a higher ROCE is better. Overall, it is a valuable metric that has its flaws. Renowned investment researcher Michael Mauboussin has suggested that a high ROCE can indicate that ‘one dollar invested in the company generates value of more than one dollar’.

So, How Do We Calculate ROCE?
Analysts use this formula to calculate return on capital employed:

Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets – Current Liabilities)
Or for Grenergy Renovables:

0.20 = €12m ÷ (€110m – €47m) (Based on the trailing twelve months to June 2019.)

So, Grenergy Renovables has an ROCE of 20%.


https://simplywall.st/stocks/es/uti...rgy-renovables-s-a-s-bmegre-roce-can-tell-us/
 
You must log in or register to reply here.

Similar threads

A
La Fed destinará 616.653 millones de euros a comprar activos hipotecarios
Replies
6
Views
2K
ZEPPO
Z
A
A la espera de tanta novedad desde Nueva York y Washington, los mercados europeos int
Replies
1
Views
2K
Splitlink
S
M
Cocrystal pharma
Replies
1
Views
1K
mark2017
M
Rufernobolsa
PortfolioDarwinex Dinamic Daily 4
Replies
0
Views
333
Rufernobolsa
Rufernobolsa
Rufernobolsa
PortfolioDarwinex Dinamic Weekly 5
Replies
2
Views
664
Rufernobolsa
Rufernobolsa
Top