ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. United Arrows's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 1.90%.
As of today (2026-07-02), United Arrows's WACC % is 3.43%. United Arrows's ROIC % is 15.59% (calculated using TTM income statement data).
United Arrows 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.
United Arrows (TSE:7606) 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, United Arrows's WACC % is 3.43%. United Arrows's ROIC % is 15.59% (calculated using TTM income statement data).
United Arrows 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.
United Arrows ROIC % Related Terms
United Arrows ROIC % Historical Data
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The historical data trend for United Arrows'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 Apparel Retail subindustry, United Arrows'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.
United Arrows ROIC % vs Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, United Arrows's ROIC % distribution charts can be found below:
* The bar in red indicates where United Arrows'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.
United Arrows (TSE:7606) has a ROIC % of 1.90% 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 United Arrows and its competitors.
Is United Arrows' ROIC % too high?
United Arrows' current ROIC % is 1.90%. The Retail - Cyclical industry median ROIC % is 4.38. United Arrows' value of 1.90% is 56.6% below this industry median. Overall, United Arrows has a GF Score™ of 86/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does United Arrows' ROIC % compare to TJX and ROST?
United Arrows' ROIC % of 1.90% can be compared against companies in the Retail - Cyclical industry. The industry median ROIC % is 4.38. United Arrows' value of 1.90% is 56.6% 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 Retail - Cyclical company?
The median ROIC % among Retail - Cyclical companies is 4.38, based on 1,108 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. United Arrows's current ROIC % of 1.90% is 56.6% 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 United Arrows and its competitors. For the Retail - Cyclical industry, the median ROIC % is 4.38 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. United Arrows's current ROIC % is 1.90%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is United Arrows stock overvalued right now?
Based on GuruFocus' analysis, United Arrows (TSE:7606) is currently considered Fairly Valued. The stock's GF Value™ is 円2,487.13, compared to a current price of 円2,386.00 — trading 4.1% below its estimated fair value. The current ROIC % is 1.90% and 56.6% below the Retail - Cyclical industry median of 4.38. United Arrows' overall GF Score™ is 86/100 with 2 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 United Arrows (TSE:7606), the current ROIC % is 1.90% 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 United Arrows (TSE:7606) Overvalued in 2026?
Based on GuruFocus' analysis, United Arrows stock appears to be undervalued.
The current stock price of 円2,386.00 is trading 4.1% below its estimated GF Value™ of 円2,487.13.
GuruFocus considers United Arrows to be Fairly Valued.
Key valuation signals for TSE:7606:
ROIC %: 1.90%
GF Value™: 円2,487.13 vs. price of 円2,386.00 (4.1% below fair value)
Industry Position: 56.6% below the Retail - Cyclical median
No single metric tells the full story. See the TSE:7606 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
United Arrows Ltd operates retail stores that primarily sell clothing, shoes, and accessories. Almost all the company's stores are located in Japan. United Arrows also has substantial online sales. The company's stores operate under many different brand names and sell both designer and private-label brands, which they procure both in Japan and internationally. United Arrows' biggest brands include United Arrows, Beauty and Youth, Green Label Relaxing, Chrome Hearts, Odette e Odile, Another Edition, and Jewel Changes.
86GF Score
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