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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 %. Sumitomo Rubber Industries's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 3.31%.
As of today (2026-07-29), Sumitomo Rubber Industries's WACC % is 3.11%. Sumitomo Rubber Industries's ROIC % is 2.78% (calculated using TTM income statement data).
Sumitomo Rubber Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.
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, Sumitomo Rubber Industries's WACC % is 3.11%. Sumitomo Rubber Industries's ROIC % is 2.78% (calculated using TTM income statement data).
Sumitomo Rubber Industries 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.
* 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 Auto Parts subindustry, Sumitomo Rubber Industries'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.
Sumitomo Rubber Industries ROIC % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Sumitomo Rubber Industries's ROIC % distribution charts can be found below:
* The bar in red indicates where Sumitomo Rubber Industries'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.
Sumitomo Rubber Industries (TSE:5110) has a ROIC % of 3.31% 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 Sumitomo Rubber Industries and its competitors.
Is Sumitomo Rubber Industries' ROIC % too high?
Sumitomo Rubber Industries' current ROIC % is 3.31%. The Vehicles & Parts industry median ROIC % is 5.07. Sumitomo Rubber Industries' value of 3.31% is 34.7% below this industry median. Overall, Sumitomo Rubber Industries has a GF Score™ of 66/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Sumitomo Rubber Industries' ROIC % compare to ORLY and AZO?
Sumitomo Rubber Industries' ROIC % of 3.31% can be compared against companies in the Vehicles & Parts industry. The industry median ROIC % is 5.07. Sumitomo Rubber Industries' value of 3.31% is 34.7% 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 Vehicles & Parts company?
The median ROIC % among Vehicles & Parts companies is 5.07, based on 1,311 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. Sumitomo Rubber Industries's current ROIC % of 3.31% is 34.7% 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 Sumitomo Rubber Industries and its competitors. For the Vehicles & Parts industry, the median ROIC % is 5.07 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sumitomo Rubber Industries's current ROIC % is 3.31%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sumitomo Rubber Industries stock overvalued right now?
Based on GuruFocus' analysis, Sumitomo Rubber Industries (TSE:5110) is currently considered Significantly Overvalued. The stock's GF Value™ is 円1,437.03, compared to a current price of 円2,322.00 — trading 61.6% above its estimated fair value. The current ROIC % is 3.31% and 34.7% below the Vehicles & Parts industry median of 5.07. Sumitomo Rubber Industries' overall GF Score™ is 66/100 with 7 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 Sumitomo Rubber Industries (TSE:5110), the current ROIC % is 3.31% 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 Sumitomo Rubber Industries (TSE:5110) Overvalued in 2026?
Based on GuruFocus' analysis, Sumitomo Rubber Industries stock appears to be overvalued.
The current stock price of 円2,322.00 is trading 61.6% above its estimated GF Value™ of 円1,437.03.
GuruFocus considers Sumitomo Rubber Industries to be Significantly Overvalued.
Key valuation signals for TSE:5110:
ROIC %: 3.31%
GF Value™: 円1,437.03 vs. price of 円2,322.00 (61.6% above fair value)
Industry Position: 34.7% below the Vehicles & Parts median
No single metric tells the full story. See the TSE:5110 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sumitomo Rubber Industries Ltd makes and sells rubber tires, sports equipment, and other products in three segments based on product type. The tire segment, which generates the majority of revenue, sells rubber tires for automobiles and motorcycles under the Dunlop and Falken brand names. The sports segment sells golf, tennis, and fitness equipment under the Srixon, XXIO, Cleveland, and Dunlop brand names. The industrial and other products segment sells rubber parts for printers, artificial turf for sporting use, floor coating materials, portable ramps, gloves, tubes, and valves. The majority of revenue comes from Japan than any other region.
66GF Score
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