ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. VAALCO Energy's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was -6.94%.
As of today (2026-06-29), VAALCO Energy's WACC % is 5.90%. VAALCO Energy's ROC % is 0.67% (calculated using TTM income statement data).
VAALCO Energy earns returns that do not match up to its cost of capital. It will destroy value as it grows.
VAALCO Energy (LSE:EGY) 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, VAALCO Energy's WACC % is 5.90%. VAALCO Energy's ROC % is 0.67% (calculated using TTM income statement data).
VAALCO Energy 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.
VAALCO Energy ROC % Related Terms
VAALCO Energy ROC % Historical Data
* Premium members only.
The historical data trend for VAALCO Energy'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 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.
VAALCO Energy (LSE:EGY) 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 VAALCO Energy and its competitors.
Is VAALCO Energy's ROC % too high?
VAALCO Energy's current ROC % is -6.94%. Overall, VAALCO Energy has a GF Score™ of 78/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does VAALCO Energy's ROC % compare to SD and WTI?
VAALCO Energy's ROC % of -6.94% can be compared against companies in the Oil & Gas industry. The industry median ROC % is 3.66. 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 Oil & Gas company?
The median ROC % among Oil & Gas companies is 3.66, based on 1,002 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 VAALCO Energy and its competitors. For the Oil & Gas industry, the median ROC % is 3.66 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. VAALCO Energy'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 VAALCO Energy stock overvalued right now?
Based on GuruFocus' analysis, VAALCO Energy (LSE:EGY) is currently considered Significantly Overvalued. The stock's GF Value™ is £2.86, compared to a current price of £4.03 — trading 40.9% above its estimated fair value. The current ROC % is -6.94%. VAALCO Energy's overall GF Score™ is 78/100 with 7 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 VAALCO Energy (LSE:EGY), 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 VAALCO Energy (LSE:EGY) Overvalued in 2026?
Based on GuruFocus' analysis, VAALCO Energy stock appears to be overvalued.
The current stock price of £4.03 is trading 40.9% above its estimated GF Value™ of £2.86.
GuruFocus considers VAALCO Energy to be Significantly Overvalued.
Key valuation signals for LSE:EGY:
ROC %: -6.94%
GF Value™: £2.86 vs. price of £4.03 (40.9% above fair value)
No single metric tells the full story. See the LSE:EGY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
VAALCO Energy Inc is an independent energy company engaged in the acquisition, exploration, development, and production of crude oil, natural gas, and natural gas liquids (NGLs). It has a diversified, African-focused portfolio of production, development, and exploration assets located in Gabon, Egypt, Cote d'Ivoire, Equatorial Guinea, and Nigeria, which are also considered its reportable operating segments. Maximum revenue is generated from the Gabon segment, which holds working interest in and operates the Etame Marin block, located offshore Gabon. The company derives all of its revenue from crude oil, natural gas, and natural gas liquids sales.
78GF Score
Get the complete analysis for LSE:EGY
ROC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
LSE:EGY has been successfully added to your 
