ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Adrad Holdings's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2025 was 3.54%.
As of today (2026-06-30), Adrad Holdings's WACC % is 6.52%. Adrad Holdings's ROIC % is 4.67% (calculated using TTM income statement data).
Adrad Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Adrad Holdings (ASX:AHL) 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, Adrad Holdings's WACC % is 6.52%. Adrad Holdings's ROIC % is 4.67% (calculated using TTM income statement data).
Adrad Holdings 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.
Adrad Holdings ROIC % Related Terms
Adrad Holdings ROIC % Historical Data
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The historical data trend for Adrad Holdings'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 Specialty Industrial Machinery subindustry, Adrad Holdings'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.
Adrad Holdings ROIC % vs Industrial Products Industry
For the Industrial Products industry and Industrials sector, Adrad Holdings's ROIC % distribution charts can be found below:
* The bar in red indicates where Adrad Holdings's ROIC % falls into.
Note:
The Operating Income data used here is two times the semi-annual (Dec. 2025) 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.
Adrad Holdings (ASX:AHL) has a ROIC % of 3.54% as of Dec. 2025. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Adrad Holdings and its competitors.
Is Adrad Holdings' ROIC % too high?
Adrad Holdings' current ROIC % is 3.54%. The Industrial Products industry median ROIC % is 5.21. Adrad Holdings' value of 3.54% is 32.1% below this industry median. Overall, Adrad Holdings has a GF Score™ of 43/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Adrad Holdings' ROIC % compare to GEV and ETN?
Adrad Holdings' ROIC % of 3.54% can be compared against companies in the Industrial Products industry. The industry median ROIC % is 5.21. Adrad Holdings' value of 3.54% is 32.1% 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 an Industrial Products company?
The median ROIC % among Industrial Products companies is 5.21, based on 3,033 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. Adrad Holdings's current ROIC % of 3.54% is 32.1% 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 Adrad Holdings and its competitors. For the Industrial Products industry, the median ROIC % is 5.21 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Adrad Holdings's current ROIC % is 3.54%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Adrad Holdings stock overvalued right now?
Based on GuruFocus' analysis, Adrad Holdings (ASX:AHL) is currently considered Significantly Overvalued. The stock's GF Value™ is A$0.79, compared to a current price of A$1.45 — trading 83.5% above its estimated fair value. The current ROIC % is 3.54% and 32.1% below the Industrial Products industry median of 5.21. Adrad Holdings' overall GF Score™ is 43/100 with 6 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 Adrad Holdings (ASX:AHL), the current ROIC % is 3.54% as of Dec. 2025. 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 Adrad Holdings (ASX:AHL) Overvalued in 2026?
Based on GuruFocus' analysis, Adrad Holdings stock appears to be overvalued.
The current stock price of A$1.45 is trading 83.5% above its estimated GF Value™ of A$0.79.
GuruFocus considers Adrad Holdings to be Significantly Overvalued.
Key valuation signals for ASX:AHL:
ROIC %: 3.54%
GF Value™: A$0.79 vs. price of A$1.45 (83.5% above fair value)
Industry Position: 32.1% below the Industrial Products median
No single metric tells the full story. See the ASX:AHL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Adrad Holdings Ltd designs and manufactures a wide variety of original equipment and aftermarket heat exchange products for both mobile and stationary applications. The company operates in two segments: Heat Transfer Solutions and Distribution. The Heat Transfer Solutions segment which designs and manufactures industrial cooling solutions for use in road transport and heavy vehicles, mining, power generation, data centres, and rail industries. The Distribution segment includes imports and distributes radiators, mobile and stationary heat exchange products, as well as a variety of automotive parts for the automotive and industrial markets. Geographically, the company derives key revenue from Australasia and the rest from Asia, the Middle East, North America, South America, Europe, & Africa.
43GF Score
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