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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 %. Saudi Arabian Oil Co's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 23.16%.
As of today (2026-07-18), Saudi Arabian Oil Co's WACC % is 7.43%. Saudi Arabian Oil Co's ROC % is 18.99% (calculated using TTM income statement data).
Saudi Arabian Oil Co 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.
Saudi Arabian Oil Co (SAU:2222) 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, Saudi Arabian Oil Co's WACC % is 7.43%. Saudi Arabian Oil Co's ROC % is 18.99% (calculated using TTM income statement data).
Saudi Arabian Oil Co 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.
* 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.
Saudi Arabian Oil Co (SAU:2222) has a ROC % of 23.16% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Saudi Arabian Oil Co and its competitors.
Is Saudi Arabian Oil Co's ROC % too high?
Saudi Arabian Oil Co's current ROC % is 23.16%. The Oil & Gas industry median ROC % is 3.71. Saudi Arabian Oil Co's value of 23.16% is 524.3% above this industry median. Overall, Saudi Arabian Oil Co has a GF Score™ of 82/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Saudi Arabian Oil Co's ROC % compare to XOM and CVX?
Saudi Arabian Oil Co's ROC % of 23.16% can be compared against companies in the Oil & Gas industry. The industry median ROC % is 3.71. Saudi Arabian Oil Co's value of 23.16% is 524.3% 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 Oil & Gas company?
The median ROC % among Oil & Gas companies is 3.71, based on 997 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. Saudi Arabian Oil Co's current ROC % of 23.16% is 524.3% 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 Saudi Arabian Oil Co and its competitors. For the Oil & Gas industry, the median ROC % is 3.71 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Saudi Arabian Oil Co's current ROC % is 23.16%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Saudi Arabian Oil Co stock overvalued right now?
Based on GuruFocus' analysis, Saudi Arabian Oil Co (SAU:2222) is currently considered Fairly Valued. The stock's GF Value™ is ﷼27.07, compared to a current price of ﷼26.68 — trading 1.4% below its estimated fair value. The current ROC % is 23.16% and 524.3% above the Oil & Gas industry median of 3.71. Saudi Arabian Oil Co's overall GF Score™ is 82/100 with 5 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 Saudi Arabian Oil Co (SAU:2222), the current ROC % is 23.16% 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 Saudi Arabian Oil Co (SAU:2222) Overvalued in 2026?
Based on GuruFocus' analysis, Saudi Arabian Oil Co stock appears to be undervalued.
The current stock price of ﷼26.68 is trading 1.4% below its estimated GF Value™ of ﷼27.07.
GuruFocus considers Saudi Arabian Oil Co to be Fairly Valued.
Key valuation signals for SAU:2222:
ROC %: 23.16%
GF Value™: ﷼27.07 vs. price of ﷼26.68 (1.4% below fair value)
Industry Position: 524.3% above the Oil & Gas median
No single metric tells the full story. See the SAU:2222 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Saudi Aramco is the national oil company of Saudi Arabia and holds the exclusive right to explore for, produce, and refine the country's hydrocarbons. It is the largest oil and gas producer in the world with a production volume of 12.9 mmboe/d in 2025, including 10.7 mmboe/d of liquids. Its 4.2 mmb/d in net refining capacity makes it the world's fourth-largest refiner. It also owns 59.3 million metric tons of chemical manufacturing capacity, placing it among the top five global chemical companies.
82GF Score
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ROC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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