ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Nippon Hume's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 4.12%.
As of today (2026-06-30), Nippon Hume's WACC % is 2.60%. Nippon Hume's ROIC % is 4.26% (calculated using TTM income statement data).
Nippon Hume 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.
Nippon Hume (TSE:5262) 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, Nippon Hume's WACC % is 2.60%. Nippon Hume's ROIC % is 4.26% (calculated using TTM income statement data).
Nippon Hume 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.
Nippon Hume ROIC % Related Terms
Nippon Hume ROIC % Historical Data
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The historical data trend for Nippon Hume'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 Building Products & Equipment subindustry, Nippon Hume'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.
Nippon Hume ROIC % vs Construction Industry
For the Construction industry and Industrials sector, Nippon Hume's ROIC % distribution charts can be found below:
* The bar in red indicates where Nippon Hume'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.
Nippon Hume (TSE:5262) has a ROIC % of 4.12% 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 Nippon Hume and its competitors.
Is Nippon Hume's ROIC % too high?
Nippon Hume's current ROIC % is 4.12%. The Construction industry median ROIC % is 4.66. Nippon Hume's value of 4.12% is 11.6% below this industry median. Overall, Nippon Hume has a GF Score™ of 77/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Nippon Hume's ROIC % compare to TT and JCI?
Nippon Hume's ROIC % of 4.12% can be compared against companies in the Construction industry. The industry median ROIC % is 4.66. Nippon Hume's value of 4.12% is 11.6% 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 Construction company?
The median ROIC % among Construction companies is 4.66, based on 1,750 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. Nippon Hume's current ROIC % of 4.12% is 11.6% 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 Nippon Hume and its competitors. For the Construction industry, the median ROIC % is 4.66 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Nippon Hume's current ROIC % is 4.12%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Nippon Hume stock overvalued right now?
Based on GuruFocus' analysis, Nippon Hume (TSE:5262) is currently considered Significantly Overvalued. The stock's GF Value™ is 円784.65, compared to a current price of 円1,057.00 — trading 34.7% above its estimated fair value. The current ROIC % is 4.12% and 11.6% below the Construction industry median of 4.66. Nippon Hume's overall GF Score™ is 77/100 with 1 warning sign 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 Nippon Hume (TSE:5262), the current ROIC % is 4.12% 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 Nippon Hume (TSE:5262) Overvalued in 2026?
Based on GuruFocus' analysis, Nippon Hume stock appears to be overvalued.
The current stock price of 円1,057.00 is trading 34.7% above its estimated GF Value™ of 円784.65.
GuruFocus considers Nippon Hume to be Significantly Overvalued.
Key valuation signals for TSE:5262:
ROIC %: 4.12%
GF Value™: 円784.65 vs. price of 円1,057.00 (34.7% above fair value)
Industry Position: 11.6% below the Construction median
No single metric tells the full story. See the TSE:5262 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Nippon Hume Corp provides one-stop service in the design, manufacture and installation of precast concrete products. The company's three reportable segments include Foundations, Sewerage-related, and Solar Power Generation and Real Estate. In Foundations, concrete piles are manufactured and sold, and pile driving work is carried out. In the Sewerage related segment, Hume pipes, segments and other products are manufactured and sold, and pipe and drain rehabilitation projects are carried out. In Solar Power Generation and Real Estate, real estate is rented, managed and developed, and equipment related to solar power and the environment is sold and maintenance is provided for it.
77GF Score
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ROIC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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