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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 %. Al-Arabiya Real Estate Co KSC's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 1.21%.
As of today (2026-07-21), Al-Arabiya Real Estate Co KSC's WACC % is 8.44%. Al-Arabiya Real Estate Co KSC's ROC % is 1.46% (calculated using TTM income statement data).
Al-Arabiya Real Estate Co KSC earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Al-Arabiya Real Estate Co KSC (KUW:ARABREC) 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, Al-Arabiya Real Estate Co KSC's WACC % is 8.44%. Al-Arabiya Real Estate Co KSC's ROC % is 1.46% (calculated using TTM income statement data).
Al-Arabiya Real Estate Co KSC 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.
Al-Arabiya Real Estate Co KSC ROC % Related Terms
Al-Arabiya Real Estate Co KSC ROC % Historical 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.
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.
Al-Arabiya Real Estate Co KSC (KUW:ARABREC) has a ROC % of 1.21% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Al-Arabiya Real Estate Co KSC and its competitors.
Is Al-Arabiya Real Estate Co KSC's ROC % too high?
Al-Arabiya Real Estate Co KSC's current ROC % is 1.21%. The Real Estate industry median ROC % is 2.19. Al-Arabiya Real Estate Co KSC's value of 1.21% is 44.7% below this industry median. Overall, Al-Arabiya Real Estate Co KSC has a GF Score™ of 4/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Al-Arabiya Real Estate Co KSC's ROC % compare to CBRE and BEKE?
Al-Arabiya Real Estate Co KSC's ROC % of 1.21% can be compared against companies in the Real Estate industry. The industry median ROC % is 2.19. Al-Arabiya Real Estate Co KSC's value of 1.21% is 44.7% 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 Real Estate company?
The median ROC % among Real Estate companies is 2.19, based on 1,758 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. Al-Arabiya Real Estate Co KSC's current ROC % of 1.21% is 44.7% 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 Al-Arabiya Real Estate Co KSC and its competitors. For the Real Estate industry, the median ROC % is 2.19 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Al-Arabiya Real Estate Co KSC's current ROC % is 1.21%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Al-Arabiya Real Estate Co KSC stock overvalued right now?
Based on GuruFocus' analysis, Al-Arabiya Real Estate Co KSC (KUW:ARABREC) is currently considered Significantly Overvalued. The stock's GF Value™ is KWD0.06, compared to a current price of KWD0.18 — trading 198.3% above its estimated fair value. The current ROC % is 1.21% and 44.7% below the Real Estate industry median of 2.19. Al-Arabiya Real Estate Co KSC's overall GF Score™ is 4/100 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 Al-Arabiya Real Estate Co KSC (KUW:ARABREC), the current ROC % is 1.21% 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 Al-Arabiya Real Estate Co KSC (KUW:ARABREC) Overvalued in 2026?
Based on GuruFocus' analysis, Al-Arabiya Real Estate Co KSC stock appears to be overvalued.
The current stock price of KWD0.18 is trading 198.3% above its estimated GF Value™ of KWD0.06.
GuruFocus considers Al-Arabiya Real Estate Co KSC to be Significantly Overvalued.
Key valuation signals for KUW:ARABREC:
ROC %: 1.21%
GF Value™: KWD0.06 vs. price of KWD0.18 (198.3% above fair value)
Industry Position: 44.7% below the Real Estate median
No single metric tells the full story. See the KUW:ARABREC stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Al-Arabiya Real Estate Co KSC Business Description
Al-Arabiya Real Estate Co KSC is a Kuwait based company involved in the construction, contracting, developing and managing the activities of residential buildings, hotels, and commercial centres within the private and public sector. It operates in three segments. Real estate segment involves activities related to real estate investment properties. Hotels segment, which is the key revenue generator, involves establishment, acquiring and managing hotels. Investment segment involves investing in shares and share capital of the companies. Geographically, it generates revenue from Kuwait being the highest revenue driver, United Arab Emirates, and Egypt.
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