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ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Meihua International Medical Technologies Co's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2025 was 3.80%.
Meihua International Medical Technologies Co (OTCPK:MHUAF) 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, Meihua International Medical Technologies Co's WACC % is 7.09%. Meihua International Medical Technologies Co's ROIC % is 3.60% (calculated using TTM income statement data).
Meihua International Medical Technologies Co 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.
Meihua International Medical Technologies Co ROIC % Related Terms
Meihua International Medical Technologies Co ROIC % Historical Data
* 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.
Meihua International Medical Technologies Co ROIC % Chart
Meihua International Medical Technologies Co Annual Data
For the Medical Instruments & Supplies subindustry, Meihua International Medical Technologies Co'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.
Meihua International Medical Technologies Co ROIC % vs Medical Devices & Instruments Industry
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.
Meihua International Medical Technologies Co (MHUAF) has a ROIC % of 3.80% 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 Meihua International Medical Technologies Co and its competitors.
Is Meihua International Medical Technologies Co's ROIC % too high?
Meihua International Medical Technologies Co's current ROIC % is 3.80%. The Medical Devices & Instruments industry median ROIC % is 1.28. Meihua International Medical Technologies Co's value of 3.80% is 196.9% above this industry median. Overall, Meihua International Medical Technologies Co has a GF Score™ of 59/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Meihua International Medical Technologies Co's ROIC % compare to CUPR and LUCY?
Meihua International Medical Technologies Co's ROIC % of 3.80% can be compared against companies in the Medical Devices & Instruments industry. The industry median ROIC % is 1.28. Meihua International Medical Technologies Co's value of 3.80% is 196.9% 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 1.28, based on 845 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. Meihua International Medical Technologies Co's current ROIC % of 3.80% is 196.9% 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 Meihua International Medical Technologies Co and its competitors. For the Medical Devices & Instruments industry, the median ROIC % is 1.28 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Meihua International Medical Technologies Co's current ROIC % is 3.80%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Meihua International Medical Technologies Co stock overvalued right now?
Based on GuruFocus' analysis, Meihua International Medical Technologies Co (MHUAF) is currently considered Possible Value Trap. The stock's GF Value™ is $26.50, compared to a current price of $8.77 — trading 66.9% below its estimated fair value. The current ROIC % is 3.80% and 196.9% above the Medical Devices & Instruments industry median of 1.28. Meihua International Medical Technologies Co's overall GF Score™ is 59/100 with 8 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 Meihua International Medical Technologies Co (MHUAF), the current ROIC % is 3.80% 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 Meihua International Medical Technologies Co (MHUAF) Overvalued in 2026?
Based on GuruFocus' analysis, Meihua International Medical Technologies Co stock appears to be undervalued.
The current stock price of $8.77 is trading 66.9% below its estimated GF Value™ of $26.50.
GuruFocus considers Meihua International Medical Technologies Co to be Possible Value Trap.
Key valuation signals for MHUAF:
ROIC %: 3.80%
GF Value™: $26.50 vs. price of $8.77 (66.9% below fair value)
Industry Position: 196.9% above the Medical Devices & Instruments median
No single metric tells the full story. See the MHUAF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Meihua International Medical Technologies Co Ltd is engaged in providing disposable medical devices. It serves hospitals, pharmacies, medical institutions, and medical equipment companies. Its product offerings include a Disposable Medical mask, Disposable ID Bracelet, Disposable Artificial Anal bag, Disposable Catheter, and Electonic pump among others.
59GF Score
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