ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Sonic Healthcare's annualized return on capital (ROC %) for the quarter that ended in Dec. 2025 was 4.69%.
As of today (2026-06-24), Sonic Healthcare's WACC % is 7.87%. Sonic Healthcare's ROC % is 4.68% (calculated using TTM income statement data).
Sonic Healthcare earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Sonic Healthcare (ASX:SHL) 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, Sonic Healthcare's WACC % is 7.87%. Sonic Healthcare's ROC % is 4.68% (calculated using TTM income statement data).
Sonic Healthcare 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.
Sonic Healthcare ROC % Related Terms
Sonic Healthcare ROC % Historical Data
* Premium members only.
The historical data trend for Sonic Healthcare'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 two times the semi-annual (Dec. 2025) 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.
Sonic Healthcare (ASX:SHL) has a ROC % of 4.69% as of Dec. 2025. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Sonic Healthcare and its competitors.
Is Sonic Healthcare's ROC % too high?
Sonic Healthcare's current ROC % is 4.69%. Overall, Sonic Healthcare has a GF Score™ of 82/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Sonic Healthcare's ROC % compare to TMO and DHR?
Sonic Healthcare's ROC % of 4.69% can be compared against companies in the Medical Diagnostics & Research industry. 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 Medical Diagnostics & Research company?
A good ROC % depends on the Medical Diagnostics & Research industry context. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. 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 Sonic Healthcare and its competitors. Sonic Healthcare's current ROC % is 4.69%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sonic Healthcare stock overvalued right now?
Based on GuruFocus' analysis, Sonic Healthcare (ASX:SHL) is currently considered Significantly Undervalued. The stock's GF Value™ is A$32.93, compared to a current price of A$19.86 — trading 39.7% below its estimated fair value. The current ROC % is 4.69%. Sonic Healthcare's overall GF Score™ is 82/100 with 5 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 Sonic Healthcare (ASX:SHL), the current ROC % is 4.69% as of Dec. 2025. 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 Sonic Healthcare (ASX:SHL) Overvalued in 2026?
Based on GuruFocus' analysis, Sonic Healthcare stock appears to be undervalued.
The current stock price of A$19.86 is trading 39.7% below its estimated GF Value™ of A$32.93.
GuruFocus considers Sonic Healthcare to be Significantly Undervalued.
Key valuation signals for ASX:SHL:
ROC %: 4.69%
GF Value™: A$32.93 vs. price of A$19.86 (39.7% below fair value)
No single metric tells the full story. See the ASX:SHL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sonic Healthcare is a global pathology provider. It is the largest private operator in Australia, Germany, Switzerland and the UK, the second-largest in Belgium and New Zealand, and the third largest in the US. In addition to pathology, which contributes roughly 85% of group revenue, Sonic is the second-largest player in diagnostic imaging in Australia and the largest operator of medical centers in Australia. The company typically earns about 35% of group revenue in Australia and New Zealand, 25% in the US, and 40% in Europe.
82GF Score
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