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ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Shenzhen Edge Medical Co's annualized return on capital (ROC %) for the quarter that ended in Dec. 2025 was -13.12%.
As of today (2026-08-14), Shenzhen Edge Medical Co's WACC % is 10.64%. Shenzhen Edge Medical Co's ROC % is -37.66% (calculated using TTM income statement data).
Shenzhen Edge Medical Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Shenzhen Edge Medical Co (FRA:R5Z) 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, Shenzhen Edge Medical Co's WACC % is 10.64%. Shenzhen Edge Medical Co's ROC % is -37.66% (calculated using TTM income statement data).
Shenzhen Edge Medical Co 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.
* 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.
Shenzhen Edge Medical Co (FRA:R5Z) has a ROC % of -13.12% as of Dec. 2025. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Shenzhen Edge Medical Co and its competitors.
Is Shenzhen Edge Medical Co's ROC % too high?
Shenzhen Edge Medical Co's current ROC % is -13.12%. Overall, Shenzhen Edge Medical Co has a GF Score™ of 20/100, reflecting its overall financial health beyond just this single metric.
How does Shenzhen Edge Medical Co's ROC % compare to ABT and SYK?
Shenzhen Edge Medical Co's ROC % of -13.12% can be compared against companies in the Medical Devices & Instruments industry. The industry median ROC % is 1.42. 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 Devices & Instruments company?
The median ROC % among Medical Devices & Instruments companies is 1.42, based on 846 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. 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 Shenzhen Edge Medical Co and its competitors. For the Medical Devices & Instruments industry, the median ROC % is 1.42 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Shenzhen Edge Medical Co's current ROC % is -13.12%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Shenzhen Edge Medical Co stock overvalued right now?
Shenzhen Edge Medical Co (FRA:R5Z) has a current ROC % of -13.12%. The current ROC % is -13.12%. Shenzhen Edge Medical Co's overall GF Score™ is 20/100 with 3 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 Shenzhen Edge Medical Co (FRA:R5Z), the current ROC % is -13.12% 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.
Shenzhen Edge Medical Co Ltd is principally engaged in the designing, research and development, manufacturing and sale of surgical robots. It has a pipeline of three products and product candidates covering various models at different development stages to capture the market potential in surgical robots, including Edge Multi-Port Endoscopic Surgical Robot and Edge Single-Port Endoscopic Surgical Robot for MIS, as well as Edge Bronchoscope Robot for non-invasive surgery. The company derives revenue principally from the sales of surgical robot systems, instruments and accessories, and provision of services. Geographically, the maximum revenue is generated from the Chinese mainland, followed by Asia (other than Chinese Mainland), Europe, and Others.
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