ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Sern Kou Resources Bhd's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was -3.65%.
As of today (2026-06-30), Sern Kou Resources Bhd's WACC % is 4.30%. Sern Kou Resources Bhd's ROIC % is -1.26% (calculated using TTM income statement data).
Sern Kou Resources Bhd earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Sern Kou Resources Bhd (XKLS:7180) 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, Sern Kou Resources Bhd's WACC % is 4.30%. Sern Kou Resources Bhd's ROIC % is -1.26% (calculated using TTM income statement data).
Sern Kou Resources Bhd 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 Lumber & Wood Production subindustry, Sern Kou Resources Bhd'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.
Sern Kou Resources Bhd ROIC % vs Forest Products Industry
For the Forest Products industry and Basic Materials sector, Sern Kou Resources Bhd's ROIC % distribution charts can be found below:
* The bar in red indicates where Sern Kou Resources Bhd'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.
Sern Kou Resources Bhd (XKLS:7180) has a ROIC % of -3.65% 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 Sern Kou Resources Bhd and its competitors.
Is Sern Kou Resources Bhd's ROIC % too high?
Sern Kou Resources Bhd's current ROIC % is -3.65%. Overall, Sern Kou Resources Bhd has a GF Score™ of 37/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Sern Kou Resources Bhd's ROIC % compare to SSD and UFPI?
Sern Kou Resources Bhd's ROIC % of -3.65% can be compared against companies in the Forest Products industry. The industry median ROIC % is 1.55. 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 Forest Products company?
The median ROIC % among Forest Products companies is 1.55, based on 277 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. 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 Sern Kou Resources Bhd and its competitors. For the Forest Products industry, the median ROIC % is 1.55 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sern Kou Resources Bhd's current ROIC % is -3.65%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sern Kou Resources Bhd stock overvalued right now?
Based on GuruFocus' analysis, Sern Kou Resources Bhd (XKLS:7180) is currently considered Fairly Valued. The stock's GF Value™ is RM0.85, compared to a current price of RM0.82 — trading 3.5% below its estimated fair value. The current ROIC % is -3.65%. Sern Kou Resources Bhd's overall GF Score™ is 37/100 with 4 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 Sern Kou Resources Bhd (XKLS:7180), the current ROIC % is -3.65% 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 Sern Kou Resources Bhd (XKLS:7180) Overvalued in 2026?
Based on GuruFocus' analysis, Sern Kou Resources Bhd stock appears to be undervalued.
The current stock price of RM0.82 is trading 3.5% below its estimated GF Value™ of RM0.85.
GuruFocus considers Sern Kou Resources Bhd to be Fairly Valued.
Key valuation signals for XKLS:7180:
ROIC %: -3.65%
GF Value™: RM0.85 vs. price of RM0.82 (3.5% below fair value)
No single metric tells the full story. See the XKLS:7180 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sern Kou Resources Bhd, along with its subsidiaries, is engaged in the manufacturing, processing, and trading of all kinds of timber, wood, and related products, as well as in the logging, processing, and trading of rubberwood and timber. The company's reportable segments include the manufacturing and trading of wooden furniture, investment holding, and the processing and trading of wood. Substantial revenue for the company is generated from its processing and trading of the wood segment. The company has a presence in various geographical areas, including Malaysia, the United States of America, European countries, and Asia-Pacific countries.
37GF Score
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