ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Renova Energia's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was -1.93%.
As of today (2026-06-29), Renova Energia's WACC % is 14.36%. Renova Energia's ROIC % is -3.47% (calculated using TTM income statement data).
Renova Energia earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Renova Energia (BSP:RNEW4) 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, Renova Energia's WACC % is 14.36%. Renova Energia's ROIC % is -3.47% (calculated using TTM income statement data).
Renova Energia 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.
Renova Energia ROIC % Related Terms
Renova Energia ROIC % Historical Data
* Premium members only.
The historical data trend for Renova Energia'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 Utilities - Renewable subindustry, Renova Energia'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.
Renova Energia ROIC % vs Utilities - Independent Power Producers Industry
For the Utilities - Independent Power Producers industry and Utilities sector, Renova Energia's ROIC % distribution charts can be found below:
* The bar in red indicates where Renova Energia'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.
Renova Energia (BSP:RNEW4) has a ROIC % of -1.93% 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 Renova Energia and its competitors.
Is Renova Energia's ROIC % too high?
Renova Energia's current ROIC % is -1.93%. Overall, Renova Energia has a GF Score™ of 51/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Renova Energia's ROIC % compare to competitors?
Renova Energia's ROIC % of -1.93% can be compared against companies in the Utilities - Independent Power Producers industry. The industry median ROIC % is 2.29. 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 Utilities - Independent Power Producers company?
The median ROIC % among Utilities - Independent Power Producers companies is 2.29, based on 429 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. 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 Renova Energia and its competitors. For the Utilities - Independent Power Producers industry, the median ROIC % is 2.29 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Renova Energia's current ROIC % is -1.93%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Renova Energia stock overvalued right now?
Based on GuruFocus' analysis, Renova Energia (BSP:RNEW4) is currently considered Possible Value Trap. The stock's GF Value™ is R$1.27, compared to a current price of R$0.89 — trading 29.9% below its estimated fair value. The current ROIC % is -1.93%. Renova Energia's overall GF Score™ is 51/100 with 3 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 Renova Energia (BSP:RNEW4), the current ROIC % is -1.93% 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 Renova Energia (BSP:RNEW4) Overvalued in 2026?
Based on GuruFocus' analysis, Renova Energia stock appears to be undervalued.
The current stock price of R$0.89 is trading 29.9% below its estimated GF Value™ of R$1.27.
GuruFocus considers Renova Energia to be Possible Value Trap.
Key valuation signals for BSP:RNEW4:
ROIC %: -1.93%
GF Value™: R$1.27 vs. price of R$0.89 (29.9% below fair value)
No single metric tells the full story. See the BSP:RNEW4 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Renova Energia SA is a Brazilian energy company engaged in the development, implementation, and operation of power generation projects from renewable sources - wind and solar, and trading of energy and related activities. The company is generating and trading electric power in all its forms, producing fuel from natural and renewable sources, providing logistics services to environmental advisory firms, and providing advisory services for energy solutions related to the generation, trading, transmission, and other businesses. The company has operating segments, namely: Wind, Solar, Trading, and Administrative. It derives maximum revenue from the Trading segment, which is engaged in energy trading in all its forms and management of the Company's energy purchase and sale contracts.
51GF Score
Get the complete analysis for BSP:RNEW4
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
BSP:RNEW4 has been successfully added to your 
