ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Kawasaki Heavy Industries's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 6.94%.
As of today (2026-06-26), Kawasaki Heavy Industries's WACC % is 10.88%. Kawasaki Heavy Industries's ROC % is 3.99% (calculated using TTM income statement data).
Kawasaki Heavy Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Kawasaki Heavy Industries (OTCPK:KWHIY) 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, Kawasaki Heavy Industries's WACC % is 10.88%. Kawasaki Heavy Industries's ROC % is 3.99% (calculated using TTM income statement data).
Kawasaki Heavy Industries 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 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.
Kawasaki Heavy Industries (KWHIY) has a ROC % of 6.94% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Kawasaki Heavy Industries and its competitors.
Is Kawasaki Heavy Industries' ROC % too high?
Kawasaki Heavy Industries' current ROC % is 6.94%. The Industrial Products industry median ROC % is 5.23. Kawasaki Heavy Industries' value of 6.94% is 32.8% above this industry median. Overall, Kawasaki Heavy Industries has a GF Score™ of 84/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Kawasaki Heavy Industries' ROC % compare to GEV and ETN?
Kawasaki Heavy Industries' ROC % of 6.94% can be compared against companies in the Industrial Products industry. The industry median ROC % is 5.23. Kawasaki Heavy Industries' value of 6.94% is 32.8% above 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 an Industrial Products company?
The median ROC % among Industrial Products companies is 5.23, based on 3,040 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. Kawasaki Heavy Industries's current ROC % of 6.94% is 32.8% above 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 Kawasaki Heavy Industries and its competitors. For the Industrial Products industry, the median ROC % is 5.23 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Kawasaki Heavy Industries's current ROC % is 6.94%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Kawasaki Heavy Industries stock overvalued right now?
Based on GuruFocus' analysis, Kawasaki Heavy Industries (KWHIY) is currently considered Significantly Overvalued. The stock's GF Value™ is $4.11, compared to a current price of $7.11 — trading 73% above its estimated fair value. The current ROC % is 6.94% and 32.8% above the Industrial Products industry median of 5.23. Kawasaki Heavy Industries' overall GF Score™ is 84/100 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 Kawasaki Heavy Industries (KWHIY), the current ROC % is 6.94% 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 Kawasaki Heavy Industries (KWHIY) Overvalued in 2026?
Based on GuruFocus' analysis, Kawasaki Heavy Industries stock appears to be overvalued.
The current stock price of $7.11 is trading 73% above its estimated GF Value™ of $4.11.
GuruFocus considers Kawasaki Heavy Industries to be Significantly Overvalued.
Key valuation signals for KWHIY:
ROC %: 6.94%
GF Value™: $4.11 vs. price of $7.11 (73% above fair value)
Industry Position: 32.8% above the Industrial Products median
No single metric tells the full story. See the KWHIY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Kawasaki Heavy Industries Ltd is a Japan-based conglomerate with operations in aerospace, marine, and vehicles. The company operates through six segments. The Aerospace Systems segment manufactures and sells aircraft, engines, and space-related equipment. The Energy Solutions & Marine segment provides energy equipment, hydrogen systems, marine propulsion, plants, ships, and crushers. The Power Sports & Engine segment produces motorcycles, off-road vehicles, personal watercraft, and general-purpose engines. The Precision Machinery and Robots segment offers hydraulic equipment and industrial robots. The Vehicle segment manufactures railway vehicles and snow removal machinery. The Other segment covers commerce mediation, sales, orders, and welfare facility management.
84GF Score
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