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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 %. CQ Pharmaceutical Holding Co's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2026 was 1.22%.
As of today (2026-09-16), CQ Pharmaceutical Holding Co's WACC % is 4.36%. CQ Pharmaceutical Holding Co's ROIC % is 3.30% (calculated using TTM income statement data).
CQ Pharmaceutical Holding Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.
CQ Pharmaceutical Holding Co (SZSE:000950) 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, CQ Pharmaceutical Holding Co's WACC % is 4.36%. CQ Pharmaceutical Holding Co's ROIC % is 3.30% (calculated using TTM income statement data).
CQ Pharmaceutical Holding 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.
CQ Pharmaceutical Holding Co ROIC % Related Terms
CQ Pharmaceutical Holding 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.
For the Medical Distribution subindustry, CQ Pharmaceutical Holding 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.
CQ Pharmaceutical Holding Co ROIC % vs Medical Distribution Industry
For the Medical Distribution industry and Healthcare sector, CQ Pharmaceutical Holding Co's ROIC % distribution charts can be found below:
* The bar in red indicates where CQ Pharmaceutical Holding Co's ROIC % falls into.
Note:
The Operating Income data used here is four times the quarterly (Jun. 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.
CQ Pharmaceutical Holding Co (SZSE:000950) has a ROIC % of 1.22% as of Jun. 2026. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on CQ Pharmaceutical Holding Co and its competitors.
Is CQ Pharmaceutical Holding Co's ROIC % too high?
CQ Pharmaceutical Holding Co's current ROIC % is 1.22%. The Medical Distribution industry median ROIC % is 5.29. CQ Pharmaceutical Holding Co's value of 1.22% is 76.9% below this industry median. Overall, CQ Pharmaceutical Holding Co has a GF Score™ of 77/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does CQ Pharmaceutical Holding Co's ROIC % compare to MCK and COR?
CQ Pharmaceutical Holding Co's ROIC % of 1.22% can be compared against companies in the Medical Distribution industry. The industry median ROIC % is 5.29. CQ Pharmaceutical Holding Co's value of 1.22% is 76.9% below 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 Distribution company?
The median ROIC % among Medical Distribution companies is 5.29, based on 123 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. CQ Pharmaceutical Holding Co's current ROIC % of 1.22% is 76.9% below 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 CQ Pharmaceutical Holding Co and its competitors. For the Medical Distribution industry, the median ROIC % is 5.29 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. CQ Pharmaceutical Holding Co's current ROIC % is 1.22%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is CQ Pharmaceutical Holding Co stock overvalued right now?
Based on GuruFocus' analysis, CQ Pharmaceutical Holding Co (SZSE:000950) is currently considered Fairly Valued. The stock's GF Value™ is ¥5.68, compared to a current price of ¥5.17 — trading 9% below its estimated fair value. The current ROIC % is 1.22% and 76.9% below the Medical Distribution industry median of 5.29. CQ Pharmaceutical Holding Co's overall GF Score™ is 77/100 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 CQ Pharmaceutical Holding Co (SZSE:000950), the current ROIC % is 1.22% as of Jun. 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 CQ Pharmaceutical Holding Co (SZSE:000950) Overvalued in 2026?
Based on GuruFocus' analysis, CQ Pharmaceutical Holding Co stock appears to be undervalued.
The current stock price of ¥5.17 is trading 9% below its estimated GF Value™ of ¥5.68.
GuruFocus considers CQ Pharmaceutical Holding Co to be Fairly Valued.
Key valuation signals for SZSE:000950:
ROIC %: 1.22%
GF Value™: ¥5.68 vs. price of ¥5.17 (9% below fair value)
Industry Position: 76.9% below the Medical Distribution median
No single metric tells the full story. See the SZSE:000950 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
CQ Pharmaceutical Holding Co Ltd distributes pharmaceutical products. It is the fixed-point reserve unit for drug and medical equipment of the central and Chongqing industries. The pharmaceutical business sector covers hospitals, pharmaceuticals, healthcare products, hospital sales, commercial wholesale, retail chains, terminal distribution, warehousing logistics and supply chain value-added services. Geographically, the group operates through China.
77GF Score
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