ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Air China's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 1.45%.
As of today (2026-06-25), Air China's WACC % is 3.77%. Air China's ROIC % is 0.23% (calculated using TTM income statement data).
Air China earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Air China (OTCPK:AIRYY) ROIC % Explanation
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Air China's WACC % is 3.77%. Air China's ROIC % is 0.23% (calculated using TTM income statement data).
Air China 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 %, ROIC % 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.
Air China ROIC % Related Terms
Air China ROIC % Historical Data
* Premium members only.
The historical data trend for Air China's ROIC % 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.
For the Airlines subindustry, Air China's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Air China ROIC % vs Transportation Industry
For the Transportation industry and Industrials sector, Air China's ROIC % distribution charts can be found below:
* The bar in red indicates where Air China's ROIC % falls into.
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.
Air China (AIRYY) has a ROIC % of 1.45% as of Mar. 2026. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Air China and its competitors.
Is Air China's ROIC % too high?
Air China's current ROIC % is 1.45%. The Transportation industry median ROIC % is 4.69. Air China's value of 1.45% is 69.1% below this industry median. Overall, Air China has a GF Score™ of 69/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Air China's ROIC % compare to DAL and UAL?
Air China's ROIC % of 1.45% can be compared against companies in the Transportation industry. The industry median ROIC % is 4.69. Air China's value of 1.45% is 69.1% 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 ROIC % for a Transportation company?
The median ROIC % among Transportation companies is 4.69, based on 994 companies in the industry. Companies in the top quartile (top 25%) have a ROIC % significantly above this median, while those in the bottom quartile fall well below. However, ROIC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Air China's current ROIC % of 1.45% is 69.1% 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 ROIC % mean?
A high ROIC % can signal that a stock is expensive relative to its fundamentals. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Air China and its competitors. For the Transportation industry, the median ROIC % is 4.69 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Air China's current ROIC % is 1.45%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Air China stock overvalued right now?
Based on GuruFocus' analysis, Air China (AIRYY) is currently considered Possible Value Trap. The stock's GF Value™ is $15.92, compared to a current price of $10.40 — trading 34.7% below its estimated fair value. The current ROIC % is 1.45% and 69.1% below the Transportation industry median of 4.69. Air China's overall GF Score™ is 69/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROIC % calculated?
ROIC % is calculated from a company's financial statements. For Air China (AIRYY), the current ROIC % is 1.45% 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 Air China (AIRYY) Overvalued in 2026?
Based on GuruFocus' analysis, Air China stock appears to be undervalued.
The current stock price of $10.40 is trading 34.7% below its estimated GF Value™ of $15.92.
GuruFocus considers Air China to be Possible Value Trap.
Key valuation signals for AIRYY:
ROIC %: 1.45%
GF Value™: $15.92 vs. price of $10.40 (34.7% below fair value)
Industry Position: 69.1% below the Transportation median
No single metric tells the full story. See the AIRYY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Air China Ltd is based in Beijing and principally provides airline and related services, which include aircraft engineering and airport ground handling. The majority of the company's revenue comes from airline operations, with a smaller portion generated from rental income. Company has two segments (a) The airline operations segment which mainly comprises the provision of air passenger and air cargo services; and (b) The other operations segment which comprises the provision of aircraft engineering and other airline-related services. Geographically, majority of its revenue is derived from Mainland China followed by International segment and Hong Kong SAR, Macau SAR and Taiwan.
69GF Score
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