ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Kohnan Shoji Co's annualized return on capital (ROC %) for the quarter that ended in Feb. 2026 was 1.99%.
As of today (2026-06-25), Kohnan Shoji Co's WACC % is 1.42%. Kohnan Shoji Co's ROC % is 3.30% (calculated using TTM income statement data).
Kohnan Shoji 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.
Kohnan Shoji Co (TSE:7516) 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, Kohnan Shoji Co's WACC % is 1.42%. Kohnan Shoji Co's ROC % is 3.30% (calculated using TTM income statement data).
Kohnan Shoji 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.
Kohnan Shoji Co ROC % Related Terms
Kohnan Shoji Co ROC % Historical Data
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The historical data trend for Kohnan Shoji Co'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 (Feb. 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.
Kohnan Shoji Co (TSE:7516) has a ROC % of 1.99% as of Feb. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Kohnan Shoji Co and its competitors.
Is Kohnan Shoji Co's ROC % too high?
Kohnan Shoji Co's current ROC % is 1.99%. The Retail - Cyclical industry median ROC % is 4.37. Kohnan Shoji Co's value of 1.99% is 54.5% below this industry median. Overall, Kohnan Shoji Co has a GF Score™ of 66/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Kohnan Shoji Co's ROC % compare to HD and LOW?
Kohnan Shoji Co's ROC % of 1.99% can be compared against companies in the Retail - Cyclical industry. The industry median ROC % is 4.37. Kohnan Shoji Co's value of 1.99% is 54.5% 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 Retail - Cyclical company?
The median ROC % among Retail - Cyclical companies is 4.37, based on 1,113 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. Kohnan Shoji Co's current ROC % of 1.99% is 54.5% 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 Kohnan Shoji Co and its competitors. For the Retail - Cyclical industry, the median ROC % is 4.37 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Kohnan Shoji Co's current ROC % is 1.99%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Kohnan Shoji Co stock overvalued right now?
Based on GuruFocus' analysis, Kohnan Shoji Co (TSE:7516) is currently considered Fairly Valued. The stock's GF Value™ is 円4,380.76, compared to a current price of 円3,980.00 — trading 9.1% below its estimated fair value. The current ROC % is 1.99% and 54.5% below the Retail - Cyclical industry median of 4.37. Kohnan Shoji Co's overall GF Score™ is 66/100 with 4 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 Kohnan Shoji Co (TSE:7516), the current ROC % is 1.99% as of Feb. 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 Kohnan Shoji Co (TSE:7516) Overvalued in 2026?
Based on GuruFocus' analysis, Kohnan Shoji Co stock appears to be undervalued.
The current stock price of 円3,980.00 is trading 9.1% below its estimated GF Value™ of 円4,380.76.
GuruFocus considers Kohnan Shoji Co to be Fairly Valued.
Key valuation signals for TSE:7516:
ROC %: 1.99%
GF Value™: 円4,380.76 vs. price of 円3,980.00 (9.1% below fair value)
Industry Position: 54.5% below the Retail - Cyclical median
No single metric tells the full story. See the TSE:7516 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Kohnan Shoji Co Ltd is a Japan-based company that is principally engaged in the retail of products related to home improvement, housekeeping, and automotive supplies and accessories. The company operates through three store chains with different styles: Home Center, mainly offering DIY products and household goods to improve consumers' home and life; Homestock, a small-format version of Home Center with original brands EDLP and Lifelex; and Kohnan Pro, providing tools, building materials, and working equipment for professionals. The majority of the company's stores are Home Center stores.
66GF Score
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