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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 %. RP Optical Lab's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2026 was 9.75%.
As of today (2026-07-28), RP Optical Lab's WACC % is 9.80%. RP Optical Lab's ROIC % is 17.96% (calculated using TTM income statement data).
RP Optical Lab 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.
RP Optical Lab (XTAE:RPOL) 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, RP Optical Lab's WACC % is 9.80%. RP Optical Lab's ROIC % is 17.96% (calculated using TTM income statement data).
RP Optical Lab 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.
RP Optical Lab ROIC % Related Terms
RP Optical Lab ROIC % Historical Data
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The historical data trend for RP Optical Lab'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 Electronic Components subindustry, RP Optical Lab'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.
RP Optical Lab ROIC % vs Hardware Industry
For the Hardware industry and Technology sector, RP Optical Lab's ROIC % distribution charts can be found below:
* The bar in red indicates where RP Optical Lab'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.
RP Optical Lab (XTAE:RPOL) has a ROIC % of 9.75% 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 RP Optical Lab and its competitors.
Is RP Optical Lab's ROIC % too high?
RP Optical Lab's current ROIC % is 9.75%. The Hardware industry median ROIC % is 4.12. RP Optical Lab's value of 9.75% is 136.7% above this industry median. Overall, RP Optical Lab has a GF Score™ of 16/100, reflecting its overall financial health beyond just this single metric.
How does RP Optical Lab's ROIC % compare to APH and GLW?
RP Optical Lab's ROIC % of 9.75% can be compared against companies in the Hardware industry. The industry median ROIC % is 4.12. RP Optical Lab's value of 9.75% is 136.7% above 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 Hardware company?
The median ROIC % among Hardware companies is 4.12, based on 2,446 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. RP Optical Lab's current ROIC % of 9.75% is 136.7% above 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 RP Optical Lab and its competitors. For the Hardware industry, the median ROIC % is 4.12 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. RP Optical Lab's current ROIC % is 9.75%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is RP Optical Lab stock overvalued right now?
RP Optical Lab (XTAE:RPOL) has a current ROIC % of 9.75%. The current ROIC % is 9.75% and 136.7% above the Hardware industry median of 4.12. RP Optical Lab's overall GF Score™ is 16/100 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 RP Optical Lab (XTAE:RPOL), the current ROIC % is 9.75% 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.
RP Optical Lab Ltd is engaged in developing and producing Electro-Optical modules. It is in the field of thermal imaging and is involved in the defense, homeland security, medical, and commercial markets. Its products and services are Opto-Mechanical Design, Lenses, Video Engine, Cameras & Cores, and Multi-Sensor Systems.
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