ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Air France-KLM's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 0.01%.
As of today (2026-06-24), Air France-KLM's WACC % is 7.47%. Air France-KLM's ROC % is 5.24% (calculated using TTM income statement data).
Air France-KLM earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Air France-KLM (OTCPK:AFRAF) ROC % Explanation
ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Air France-KLM's WACC % is 7.47%. Air France-KLM's ROC % is 5.24% (calculated using TTM income statement data).
Air France-KLM earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Air France-KLM ROC % Related Terms
Air France-KLM ROC % Historical Data
* Premium members only.
The historical data trend for Air France-KLM's ROC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Air France-KLM (AFRAF) has a ROC % of 0.01% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Air France-KLM and its competitors.
Is Air France-KLM's ROC % too high?
Air France-KLM's current ROC % is 0.01%. The Transportation industry median ROC % is 4.69. Air France-KLM's value of 0.01% is 99.8% below this industry median. Overall, Air France-KLM has a GF Score™ of 69/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Air France-KLM's ROC % compare to DAL and UAL?
Air France-KLM's ROC % of 0.01% can be compared against companies in the Transportation industry. The industry median ROC % is 4.69. Air France-KLM's value of 0.01% is 99.8% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for a Transportation company?
The median ROC % among Transportation companies is 4.69, based on 994 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Air France-KLM's current ROC % of 0.01% is 99.8% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Air France-KLM and its competitors. For the Transportation industry, the median ROC % is 4.69 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Air France-KLM's current ROC % is 0.01%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Air France-KLM stock overvalued right now?
Based on GuruFocus' analysis, Air France-KLM (AFRAF) is currently considered Modestly Overvalued. The stock's GF Value™ is $11.67, compared to a current price of $13.38 — trading 14.7% above its estimated fair value. The current ROC % is 0.01% and 99.8% below the Transportation industry median of 4.69. Air France-KLM's overall GF Score™ is 69/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For Air France-KLM (AFRAF), the current ROC % is 0.01% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Air France-KLM (AFRAF) Overvalued in 2026?
Based on GuruFocus' analysis, Air France-KLM stock appears to be overvalued.
The current stock price of $13.38 is trading 14.7% above its estimated GF Value™ of $11.67.
GuruFocus considers Air France-KLM to be Modestly Overvalued.
Key valuation signals for AFRAF:
ROC %: 0.01%
GF Value™: $11.67 vs. price of $13.38 (14.7% above fair value)
Industry Position: 99.8% below the Transportation median
No single metric tells the full story. See the AFRAF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Air France-KLM is a European airline group engaged in businesses that include passenger and cargo transportation, low-cost operations, and aircraft maintenance. The group has four segments: network, maintenance, Transavia, and other. The network segment derives key revenue for the passenger and cargo network, mainly coming from passenger transportation services on scheduled flights with the group's airline code. The company's geographic markets include France, Benelux, Europe, and the rest of the world, with the majority of revenue coming from France, including its overseas division.
69GF Score
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ROC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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