ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Diffusion Engineers's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 12.55%.
As of today (2025-04-05), Diffusion Engineers's WACC % is 12.32%. Diffusion Engineers's ROC % is 12.55% (calculated using TTM income statement data).
Diffusion Engineers generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
Diffusion Engineers ROC % Historical Data
The historical data trend for Diffusion Engineers'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.
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Diffusion Engineers ROC % Chart
Diffusion Engineers Annual Data
Trend
Mar21
Mar22
Mar23
Mar24
ROC %
10.05
10.46
11.64
12.55
Diffusion Engineers Semi-Annual Data
Mar21
Mar22
Mar23
Mar24
ROC %
10.05
10.46
11.64
12.55
Diffusion Engineers ROC % Calculation
Diffusion Engineers's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2024 is calculated as:
Note:
The Operating Income data used here is one times the annual (Mar. 2024) data.
* 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.
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, Diffusion Engineers's WACC % is 12.32%. Diffusion Engineers's ROC % is 12.55% (calculated using TTM income statement data).
Diffusion Engineers generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
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.
Diffusion Engineers ROC % Related Terms
Thank you for viewing the detailed overview of Diffusion Engineers's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Diffusion Engineers Ltd is engaged in the business of manufacturing welding consumables, wear plates and wear parts and heavy engineering machinery for core industries. Additionally, it is also involved in the trading of anti-wear powders and welding and cutting machinery. The company provides a super conditioning process at its manufacturing facilities, a surface treatment solution for machine components that enhances wear resistance, eliminates stress and improves their repairability ultimately extending their lifespan.
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