ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Mercury NZ's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2025 was 5.39%.
As of today (2026-06-25), Mercury NZ's WACC % is 8.56%. Mercury NZ's ROIC % is 3.42% (calculated using TTM income statement data).
Mercury NZ earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Mercury NZ (OTCPK:MGHTF) 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, Mercury NZ's WACC % is 8.56%. Mercury NZ's ROIC % is 3.42% (calculated using TTM income statement data).
Mercury NZ 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.
Mercury NZ ROIC % Related Terms
Mercury NZ ROIC % Historical Data
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The historical data trend for Mercury NZ'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, Mercury NZ'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.
Mercury NZ ROIC % vs Utilities - Independent Power Producers Industry
For the Utilities - Independent Power Producers industry and Utilities sector, Mercury NZ's ROIC % distribution charts can be found below:
* The bar in red indicates where Mercury NZ'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.
Mercury NZ (MGHTF) has a ROIC % of 5.39% 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 Mercury NZ and its competitors.
Is Mercury NZ's ROIC % too high?
Mercury NZ's current ROIC % is 5.39%. The Utilities - Independent Power Producers industry median ROIC % is 2.27. Mercury NZ's value of 5.39% is 138% above this industry median. Overall, Mercury NZ has a GF Score™ of 78/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Mercury NZ's ROIC % compare to competitors?
Mercury NZ's ROIC % of 5.39% can be compared against companies in the Utilities - Independent Power Producers industry. The industry median ROIC % is 2.27. Mercury NZ's value of 5.39% is 138% 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 an Utilities - Independent Power Producers company?
The median ROIC % among Utilities - Independent Power Producers companies is 2.27, based on 430 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. Mercury NZ's current ROIC % of 5.39% is 138% 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 Mercury NZ and its competitors. For the Utilities - Independent Power Producers industry, the median ROIC % is 2.27 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Mercury NZ's current ROIC % is 5.39%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Mercury NZ stock overvalued right now?
Based on GuruFocus' analysis, Mercury NZ (MGHTF) is currently considered Fairly Valued. The stock's GF Value™ is $4.06, compared to a current price of $4.37 — trading 7.6% above its estimated fair value. The current ROIC % is 5.39% and 138% above the Utilities - Independent Power Producers industry median of 2.27. Mercury NZ's overall GF Score™ is 78/100 with 11 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 Mercury NZ (MGHTF), the current ROIC % is 5.39% 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 Mercury NZ (MGHTF) Overvalued in 2026?
Based on GuruFocus' analysis, Mercury NZ stock appears to be overvalued.
The current stock price of $4.37 is trading 7.6% above its estimated GF Value™ of $4.06.
GuruFocus considers Mercury NZ to be Fairly Valued.
Key valuation signals for MGHTF:
ROIC %: 5.39%
GF Value™: $4.06 vs. price of $4.37 (7.6% above fair value)
Industry Position: 138% above the Utilities - Independent Power Producers median
No single metric tells the full story. See the MGHTF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Mercury NZ (formerly Mighty River Power) generates more than 15% of New Zealand's electricity and is one of the four major electricity generators and suppliers in the country. All electricity is generated from renewable sources, which makes it one of the lowest-cost providers of electricity. The company operates nine hydro stations and five geothermal power plants in the North Island and some wind farms. Mercury sells electricity to residential and commercial customers and has the largest share of the key Auckland market.
78GF Score
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