ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Arabian Contracting Services Co's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 3.27%.
As of today (2026-07-02), Arabian Contracting Services Co's WACC % is 9.97%. Arabian Contracting Services Co's ROC % is 2.89% (calculated using TTM income statement data).
Arabian Contracting Services Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Arabian Contracting Services Co (SAU:4071) 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, Arabian Contracting Services Co's WACC % is 9.97%. Arabian Contracting Services Co's ROC % is 2.89% (calculated using TTM income statement data).
Arabian Contracting Services 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.
Arabian Contracting Services Co ROC % Related Terms
Arabian Contracting Services Co 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.
Arabian Contracting Services Co (SAU:4071) has a ROC % of 3.27% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Arabian Contracting Services Co and its competitors.
Is Arabian Contracting Services Co's ROC % too high?
Arabian Contracting Services Co's current ROC % is 3.27%. The Media - Diversified industry median ROC % is 1.39. Arabian Contracting Services Co's value of 3.27% is 135.3% above this industry median. Overall, Arabian Contracting Services Co has a GF Score™ of 82/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Arabian Contracting Services Co's ROC % compare to APP and OMC?
Arabian Contracting Services Co's ROC % of 3.27% can be compared against companies in the Media - Diversified industry. The industry median ROC % is 1.39. Arabian Contracting Services Co's value of 3.27% is 135.3% 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 a Media - Diversified company?
The median ROC % among Media - Diversified companies is 1.39, based on 1,008 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. Arabian Contracting Services Co's current ROC % of 3.27% is 135.3% 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 Arabian Contracting Services Co and its competitors. For the Media - Diversified industry, the median ROC % is 1.39 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Arabian Contracting Services Co's current ROC % is 3.27%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Arabian Contracting Services Co stock overvalued right now?
Based on GuruFocus' analysis, Arabian Contracting Services Co (SAU:4071) is currently considered Possible Value Trap. The stock's GF Value™ is ﷼188.89, compared to a current price of ﷼90.70 — trading 52% below its estimated fair value. The current ROC % is 3.27% and 135.3% above the Media - Diversified industry median of 1.39. Arabian Contracting Services Co's overall GF Score™ is 82/100 with 9 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 Arabian Contracting Services Co (SAU:4071), the current ROC % is 3.27% 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 Arabian Contracting Services Co (SAU:4071) Overvalued in 2026?
Based on GuruFocus' analysis, Arabian Contracting Services Co stock appears to be undervalued.
The current stock price of ﷼90.70 is trading 52% below its estimated GF Value™ of ﷼188.89.
GuruFocus considers Arabian Contracting Services Co to be Possible Value Trap.
Key valuation signals for SAU:4071:
ROC %: 3.27%
GF Value™: ﷼188.89 vs. price of ﷼90.70 (52% below fair value)
Industry Position: 135.3% above the Media - Diversified median
No single metric tells the full story. See the SAU:4071 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Arabian Contracting Services Co Business Description
Arabian Contracting Services Co is an outdoor advertising solution provider, offering clients expertise across a multitude of platforms and disciplines. It is mainly engaged in establishing and operating outdoor advertising billboards, including roadside and indoor advertisements. The group's operating segments are Advertising and Others. The Advertising segment, which generates a majority of its revenue, is engaged in the provision of indoor and outdoor advertisements. The Others segment includes all types of printing work and retail sales by mail. Geographically, the group derives maximum revenue from its business in the Kingdom of Saudi Arabia, and also has a presence in the Arab Republic of Egypt and the United Arab Emirates.
82GF Score
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