ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Simonds Group's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2025 was 8.63%.
As of today (2026-06-27), Simonds Group's WACC % is 6.32%. Simonds Group's ROIC % is 4.96% (calculated using TTM income statement data).
Simonds Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Simonds Group (ASX:SIO) 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, Simonds Group's WACC % is 6.32%. Simonds Group's ROIC % is 4.96% (calculated using TTM income statement data).
Simonds Group 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.
Simonds Group ROIC % Related Terms
Simonds Group ROIC % Historical Data
* Premium members only.
The historical data trend for Simonds Group'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 Residential Construction subindustry, Simonds Group'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.
Simonds Group ROIC % vs Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, Simonds Group's ROIC % distribution charts can be found below:
* The bar in red indicates where Simonds Group'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.
Simonds Group (ASX:SIO) has a ROIC % of 8.63% 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 Simonds Group and its competitors.
Is Simonds Group's ROIC % too high?
Simonds Group's current ROIC % is 8.63%. The Homebuilding & Construction industry median ROIC % is 4.78. Simonds Group's value of 8.63% is 80.5% above this industry median. Overall, Simonds Group has a GF Score™ of 48/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Simonds Group's ROIC % compare to DHI and PHM?
Simonds Group's ROIC % of 8.63% can be compared against companies in the Homebuilding & Construction industry. The industry median ROIC % is 4.78. Simonds Group's value of 8.63% is 80.5% 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 ROIC % for a Homebuilding & Construction company?
The median ROIC % among Homebuilding & Construction companies is 4.78, based on 95 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. Simonds Group's current ROIC % of 8.63% is 80.5% 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 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 Simonds Group and its competitors. For the Homebuilding & Construction industry, the median ROIC % is 4.78 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Simonds Group's current ROIC % is 8.63%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Simonds Group stock overvalued right now?
Based on GuruFocus' analysis, Simonds Group (ASX:SIO) is currently considered Fairly Valued. The stock's GF Value™ is A$0.14, compared to a current price of A$0.15 — trading 7.1% above its estimated fair value. The current ROIC % is 8.63% and 80.5% above the Homebuilding & Construction industry median of 4.78. Simonds Group's overall GF Score™ is 48/100 with 7 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 Simonds Group (ASX:SIO), the current ROIC % is 8.63% 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 Simonds Group (ASX:SIO) Overvalued in 2026?
Based on GuruFocus' analysis, Simonds Group stock appears to be overvalued.
The current stock price of A$0.15 is trading 7.1% above its estimated GF Value™ of A$0.14.
GuruFocus considers Simonds Group to be Fairly Valued.
Key valuation signals for ASX:SIO:
ROIC %: 8.63%
GF Value™: A$0.14 vs. price of A$0.15 (7.1% above fair value)
Industry Position: 80.5% above the Homebuilding & Construction median
No single metric tells the full story. See the ASX:SIO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Simonds Group Ltd is engaged in the design and construction of residential dwellings. Its operating segment includes Residential construction and Land development. The company generates maximum revenue from the Residential construction segment. Its Residential construction segment includes activities relating to contracts for residential home construction, speculative home building, and the building of display home inventory. Geographically, it operates only in Australia.
48GF Score
Get the complete analysis for ASX:SIO
ROIC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
ASX:SIO has been successfully added to your 
