ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Merit Medical Systems's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 6.72%.
As of today (2026-06-27), Merit Medical Systems's WACC % is 6.22%. Merit Medical Systems's ROIC % is 7.03% (calculated using TTM income statement data).
Merit Medical Systems 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.
Merit Medical Systems (FRA:MM3) 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, Merit Medical Systems's WACC % is 6.22%. Merit Medical Systems's ROIC % is 7.03% (calculated using TTM income statement data).
Merit Medical Systems 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 Medical Instruments & Supplies subindustry, Merit Medical Systems'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.
Merit Medical Systems ROIC % vs Medical Devices & Instruments Industry
For the Medical Devices & Instruments industry and Healthcare sector, Merit Medical Systems's ROIC % distribution charts can be found below:
* The bar in red indicates where Merit Medical Systems'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.
Merit Medical Systems (FRA:MM3) has a ROIC % of 6.72% 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 Merit Medical Systems and its competitors.
Is Merit Medical Systems' ROIC % too high?
Merit Medical Systems' current ROIC % is 6.72%. The Medical Devices & Instruments industry median ROIC % is 1.26. Merit Medical Systems' value of 6.72% is 433.3% above this industry median. Overall, Merit Medical Systems has a GF Score™ of 85/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Merit Medical Systems' ROIC % compare to NVST and MMED?
Merit Medical Systems' ROIC % of 6.72% can be compared against companies in the Medical Devices & Instruments industry. The industry median ROIC % is 1.26. Merit Medical Systems' value of 6.72% is 433.3% 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 Medical Devices & Instruments company?
The median ROIC % among Medical Devices & Instruments companies is 1.26, based on 847 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. Merit Medical Systems's current ROIC % of 6.72% is 433.3% 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 Merit Medical Systems and its competitors. For the Medical Devices & Instruments industry, the median ROIC % is 1.26 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Merit Medical Systems's current ROIC % is 6.72%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Merit Medical Systems stock overvalued right now?
Based on GuruFocus' analysis, Merit Medical Systems (FRA:MM3) is currently considered Modestly Undervalued. The stock's GF Value™ is €84.32, compared to a current price of €62.50 — trading 25.9% below its estimated fair value. The current ROIC % is 6.72% and 433.3% above the Medical Devices & Instruments industry median of 1.26. Merit Medical Systems' overall GF Score™ is 85/100. 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 Merit Medical Systems (FRA:MM3), the current ROIC % is 6.72% 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 Merit Medical Systems (FRA:MM3) Overvalued in 2026?
Based on GuruFocus' analysis, Merit Medical Systems stock appears to be undervalued.
The current stock price of €62.50 is trading 25.9% below its estimated GF Value™ of €84.32.
GuruFocus considers Merit Medical Systems to be Modestly Undervalued.
Key valuation signals for FRA:MM3:
ROIC %: 6.72%
GF Value™: €84.32 vs. price of €62.50 (25.9% below fair value)
Industry Position: 433.3% above the Medical Devices & Instruments median
No single metric tells the full story. See the FRA:MM3 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Merit Medical Systems Inc is a medical equipment company that develops and manufactures products for interventional cardiology, radiology, and endoscopy procedures. The firm reports two segments which are Cardiovascular and Endoscopy. The majority of the revenue is earned from the Cardiovascular segment which consists of cardiology and radiology medical device products that assist in diagnosing and treating coronary artery disease, peripheral vascular disease, and other non-vascular diseases and includes embolotherapeutic, cardiac rhythm management, electrophysiology, critical care, and interventional oncology and spine devices.
85GF Score
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