ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Encore Capital Group's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 10.40%.
As of today (2026-06-27), Encore Capital Group's WACC % is 7.72%. Encore Capital Group's ROIC % is 9.16% (calculated using TTM income statement data).
Encore Capital Group 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.
Encore Capital Group (NAS:ECPG) 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, Encore Capital Group's WACC % is 7.72%. Encore Capital Group's ROIC % is 9.16% (calculated using TTM income statement data).
Encore Capital Group 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 %, 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.
* 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 Credit Services subindustry, Encore Capital 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.
Encore Capital Group ROIC % vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Encore Capital Group's ROIC % distribution charts can be found below:
* The bar in red indicates where Encore Capital Group'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.
Encore Capital Group (ECPG) has a ROIC % of 10.40% 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 Encore Capital Group and its competitors.
Is Encore Capital Group's ROIC % too high?
Encore Capital Group's current ROIC % is 10.40%. The Credit Services industry median ROIC % is 1.98. Encore Capital Group's value of 10.40% is 425.3% above this industry median. Overall, Encore Capital Group has a GF Score™ of 68/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Encore Capital Group's ROIC % compare to AGM.A and EZPW?
Encore Capital Group's ROIC % of 10.40% can be compared against companies in the Credit Services industry. The industry median ROIC % is 1.98. Encore Capital Group's value of 10.40% is 425.3% 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 Credit Services company?
The median ROIC % among Credit Services companies is 1.98, based on 417 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. Encore Capital Group's current ROIC % of 10.40% is 425.3% 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 Encore Capital Group and its competitors. For the Credit Services industry, the median ROIC % is 1.98 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Encore Capital Group's current ROIC % is 10.40%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Encore Capital Group stock overvalued right now?
Based on GuruFocus' analysis, Encore Capital Group (ECPG) is currently considered Modestly Overvalued. The stock's GF Value™ is $72.30, compared to a current price of $90.62 — trading 25.3% above its estimated fair value. The current ROIC % is 10.40% and 425.3% above the Credit Services industry median of 1.98. Encore Capital Group's overall GF Score™ is 68/100 with 10 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 Encore Capital Group (ECPG), the current ROIC % is 10.40% 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 Encore Capital Group (ECPG) Overvalued in 2026?
Based on GuruFocus' analysis, Encore Capital Group stock appears to be overvalued.
The current stock price of $90.62 is trading 25.3% above its estimated GF Value™ of $72.30.
GuruFocus considers Encore Capital Group to be Modestly Overvalued.
Key valuation signals for ECPG:
ROIC %: 10.40%
GF Value™: $72.30 vs. price of $90.62 (25.3% above fair value)
Industry Position: 425.3% above the Credit Services median
No single metric tells the full story. See the ECPG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Encore Capital Group Inc is an international specialty finance company engaged in providing debt recovery solutions and other related services for consumers across a broad range of financial assets. It mainly purchases portfolios of defaulted consumer receivables at deep discounts to face value and manages them by working with individuals to repay their obligations and work toward financial recovery. The company also provides debt servicing and other portfolio management services to credit originators for non-performing loans in Europe. It has only one reportable segment, debt purchasing and recovery. Geographically, the company generates maximum revenue from its business in the United States, followed by the United Kingdom, Europe, and other regions.
68GF Score
Get the complete analysis for ECPG
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
ECPG has been successfully added to your 
