Celebrus Technologies plc's (LON:CLBS) Stock Is Going Strong: Is the Market Following Fundamentals?
Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors' money. In simpler terms, it measures the profitability of a company in relation to shareholder's equity.
This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.
How To Calculate Return On Equity?
The formula for return on equity is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Celebrus Technologies is:
15% = UK£6.4m ÷ UK£43m (Based on the trailing twelve months to March 2025).
The 'return' is the amount earned after tax over the last twelve months. Another way to think of that is that for every £1 worth of equity, the company was able to earn £0.15 in profit.
Check out our latest analysis for Celebrus Technologies
Why Is ROE Important For Earnings Growth?
We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don't share these attributes.
Celebrus Technologies' Earnings Growth And 15% ROE
To begin with, Celebrus Technologies seems to have a respectable ROE. Yet, the fact that the company's ROE is lower than the industry average of 20% does temper our expectations. Celebrus Technologies was still able to see a decent net income growth of 13% over the past five years. We reckon that there could be other factors at play here. Such as - high earnings retention or an efficient management in place. However, not to forget, the company does have a decent ROE to begin with, just that it is lower than the industry average. So this also does lend some color to the fairly high earnings growth seen by the company.
As a next step, we compared Celebrus Technologies' net income growth with the industry, and pleasingly, we found that the growth seen by the company is higher than the average industry growth of 10.0%.
Earnings growth is an important metric to consider when valuing a stock. It's important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). Doing so will help them establish if the stock's future looks promising or ominous. Has the market priced in the future outlook for CLBS? You can find out in our latest intrinsic value infographic research report.
Is Celebrus Technologies Making Efficient Use Of Its Profits?
Celebrus Technologies has a three-year median payout ratio of 33%, which implies that it retains the remaining 67% of its profits. This suggests that its dividend is well covered, and given the decent growth seen by the company, it looks like management is reinvesting its earnings efficiently.
Moreover, Celebrus Technologies is determined to keep sharing its profits with shareholders which we infer from its long history of paying a dividend for at least ten years. Based on the latest analysts' estimates, we found that the company's future payout ratio over the next three years is expected to hold steady at 35%. However, Celebrus Technologies' future ROE is expected to decline to 10% despite there being not much change anticipated in the company's payout ratio.
Summary
On the whole, we feel that Celebrus Technologies' performance has been quite good. Specifically, we like that it has been reinvesting a high portion of its profits at a moderate rate of return, resulting in earnings expansion. With that said, on studying the latest analyst forecasts, we found that while the company has seen growth in its past earnings, analysts expect its future earnings to shrink. Are these analysts expectations based on the broad expectations for the industry, or on the company's fundamentals? Click here to be taken to our analyst's forecasts page for the company.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
16 minutes ago
- Yahoo
Day-Trading Restraints to Be Loosened Under Proposed Rule Change
(Bloomberg) -- US regulators are finalizing plans to replace a controversial rule that would dramatically lower a threshold for retail investors to trade equities and options more often. Why the Federal Reserve's Building Renovation Costs $2.5 Billion Milan Corruption Probe Casts Shadow Over Property Boom How San Jose's Mayor Is Working to Build an AI Capital The Financial Industry Regulatory Authority is looking to rework the 'pattern day trading' rule that limits investors with less than $25,000 in their margin account from borrowing to trade four or more times in a five-day period. In a proposal being prepared for Finra's board to eventually vote on, retail investors would need to have only $2,000 in their accounts for such trades. Currently, when an investor with less than $25,000 exceeds the $2,000 margin in borrowing from a brokerage to make equity and options trades, Finra classifies the investor as a pattern day trader, meaning they're prohibited from making excess trades on margin. If the draft proposal goes forward, the three-trade maximum would be eliminated and individual brokerages would make their own margin calculation and decisions as to the minimum balance that customers need to day trade. The existing rule, adopted in 2001, was put in place to protect investors from massive losses and borrowing more than they can cover in holdings or cash. Industry executives say that markets have evolved since, spurring Finra to review the current requirements. 'Today, trading is often commission-free, although not in all securities, and there's less concern about excessive commission cost,' said Haoxiang Zhu, a finance professor at the Massachusetts Institute of Technology's Sloan School of Management and former Securities and Exchange Commission official. 'For this reason, I think a moderate reduction in the minimum margin for pattern day trading is fine, in particular if the reduction applies to securities for which trading is now commission-free.' As Finra considers revising the rule, a group of retail brokerages met to discuss a draft of the proposal that is likely to be submitted to Finra's board in the fall, according to people with knowledge of the matter. If the board approves the proposal, Finra — a self-regulatory organization for broker-dealers — is expected to submit it to the SEC for final approval by the end of the year, the people said, asking not to be identified discussing information that isn't public. SEC Approval More than 50 brokerages and clients have written to Finra, which requested comments on a potential rule change in late October. If the current iteration of the proposal is sent to Finra, it will then go through to an additional comment period before progressing to the SEC. An actual rule change may take as long as a year to implement, according to people familiar with the matter. A Finra representative said the regulator has 'no update to share at this time' beyond the October request for comments. The PDT rule has long garnered complaints from retail investors and their brokerages for being overly restrictive on those with smaller accounts. The market for equity-options contracts has expanded by 23% since last June. Addressing demand growth, brokerages point to improvements in their own risk-management since the rule was put in place more than two decades ago. Any change is likely to open up the market for more retail participation, given the lowering of the day-trading threshold to $2,000. That could garner criticism from those who warn against impulsive day-trading habits, with fewer guardrails against excessive risk-taking. A study from the Stanford Graduate School of Business in 2024 found 'increasing market access will likely impair retail investors' performance.' Outside the US, regulators have flagged their own concerns. The Securities and Exchange Board of India study released this month found that 91% of retail investors report losses from trading equity derivatives. 'Day trading on a margin account is risky, and that's why Finra put this rule in place,' Zhu said. Options Embraced Individual investors have embraced options trading, a type of derivative that gives holders the ability to buy or sell an asset — such as an individual stock or an exchange-traded fund —— at a specific price on or before a certain date. This practice enables traders to bet on the direction of stocks for a fraction of the cost of buying and selling the actual securities. Options trading has soared as tariff-related uncertainty has yet to abate. Seeking quick returns, retail traders have been 'buying the dip,' taking risky bets on price moves comparable to those made during the meme-stock craze that started in 2020. At the time, traders sitting at home funneled their money into equities such as GameStop Corp. and AMC Entertainment Holdings Inc. with little concern for company performance, and many investors lost substantial amounts of money. Online brokerages such as Robinhood Markets Inc. were criticized during the meme-stock boom for 'gamifying' investing, but have since sought to rebrand and target risk-averse customers alongside other clients. Some brokerages and retail traders now see the PDT rule as an antiquated relic of the dot-com bubble, when greater protections were deemed necessary to mitigate risks. Some of these risks involved high trading costs and a lack of customer oversight by brokerages — more of an issue when monitoring software was less sophisticated. Changing Times 'This rule was created at a time when retail investors' access to information, pricing and news was greatly disadvantaged,' Anthony Denier, US chief executive officer of retail brokerage Webull Financial, said in an emailed statement. 'Times have changed and the rule needs to be changed as well by removing the minimum dollar amount requirement.' Brokerages including Robinhood, Fidelity Investments and Tastytrade Inc. wrote in their comment letters to Finra that improved monitoring of trades makes it easier for customers to avoid margin calls — when an account is frozen until the minimum balance is restored —— and that the introduction of zero-commission fees has lowered costs and eased financial risk. Brokers currently reject trades if an account has insufficient buying power and track their clients' positions using automated controls and monitoring systems, allowing customers to manage intraday risk in real time. In today's options market, profits are reliant on incremental price changes, meaning the ability to quickly open and close positions is crucial. 'I think the balance requirement should be ended entirely,' said Cullen Baker, 23, who graduated from Carleton College in June with a degree in computer science. At 18, Baker was unable to trade options due to the rule, and instead ended up trading riskier products such as futures, ultimately 'blowing up' his account, said Cullen, who submitted comments asking Finra to change the rule. 'It's a pointless barrier if you want to figure out how to trade.' Individual investors frequently complain on Reddit forums that the $25,000 minimum is arbitrary, making traders over-allocate capital to their accounts to an extent detrimental to saving, and imposing a barrier for those seen as not wealthy or intelligent enough to trade equity derivatives. Clients can also open additional margin accounts at multiple brokerages to work around the rule, leading brokerages to view it as ineffective. 'It's kind of a silly little rule that gets in the way of freely functioning markets,' said Mark Phillips, founder and principal of Redding, Connecticut-based Harvested Financial, a financial-advisory firm that specializes in options trading. 'If you want people to trade options well and not gamble, they have to learn how to trade.' A Rebel Army Is Building a Rare-Earth Empire on China's Border Elon Musk's Empire Is Creaking Under the Strain of Elon Musk Thailand's Changing Cannabis Rules Leave Farmers in a Tough Spot How Starbucks' CEO Plans to Tame the Rush-Hour Free-for-All What the Tough Job Market for New College Grads Says About the Economy ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16 minutes ago
- Yahoo
Schlumberger (SLB) Dives 10.69% as Earnings Disappoint
We recently published Schlumberger Limited (NYSE:SLB) is one of this week's top performers. Schlumberger saw its share prices decrease by 10.69 percent week-on-week from $37.31 on July 11 to $33.32 last Friday, as investor sentiment was dampened by a disappointing earnings performance in the second quarter of the year. In its earnings release, Schlumberger Limited (NYSE:SLB) said attributable net income, excluding charges and credits, fell by 17 percent to $1.016 billion from $1.224 billion in the same period last year. Revenues dropped by 6 percent to $8.546 billion from $9.139 billion year-on-year. An aerial view of a well site, depicting the scale of oil and gas operations. Schlumberger Limited (NYSE:SLB) regarded its performance as 'solid,' saying that it leveraged its diversified portfolio and broad market exposure to deliver steady revenues despite the market navigating several dynamics and macroeconomic uncertainties. 'Despite this, commodity prices have remained range-bound. Meanwhile, customers have selectively adjusted activity, prioritizing key projects and planning cautiously, particularly in offshore deepwater markets,' it said. While we acknowledge the potential of SLB as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16 minutes ago
- Yahoo
Life sciences VC Omega Funds closes $647m funding round
Life sciences venture capital (VC) company Omega Funds has closed its eighth fund, with capital commitments totalling $647m. As with its previous funds, the US-based business said its oversubscribed funding, which had initially targeted a $600m close, will continue executing on its strategy to support management teams in the US and Europe that target severe, unmet medical needs through company creation, early venture rounds, and later-stage financing. Omega Funds managing director Francesco Draetta said: 'We believe our broad investment strategy is well-positioned for navigating this period of macro and policy uncertainty. 'We look forward to contributing our capital, expertise, and network connectivity in partnering with entrepreneurs, founders, co-investors, and the broader community to transform the standards of care for severe diseases.' According to Omega, it has raised $2.5bn since its first fund in 2004 to support the development of medical devices and therapeutics across indications including oncology, immunology, and rare diseases. In total, 52 products have been brought to market by Omega's former portfolio companies, with the VC's previous investments resulting in 50 exits via M&A, and 47 public listings. M&A exits include SoniVie, Scorpion Therapeutics, and Amunix Pharmaceuticals, which were acquired by Boston Scientific, Eli Lilly, and Sanofi, respectively. Companies that Omega has invested in have gone on to launch initial public offerings (IPO). These include Kestra Medical Technologies, Beta Bionics, and Imago Biosciences, all of which are listed on the Nasdaq exchange. Omega Funds' founder and managing director Otello Stampacchia commented: 'By exceeding its target size, fund VIII is a recognition of our investment strategy and track record of consistent exits across market cycles.' Life science companies are typically reliant on investment from VC or private equity (PE) businesses. While research by Bain & Company found that deal value in 2023 struggled to match the pace of previous years, more recent research by the consultant found that healthcare PE soared to an estimated $115bn in 2024, making it the second-highest deal value total on record. Other significant entities backing life science companies include Symbiotic Capital. The credit company from biotech entrepreneur Arie Belldegrun, founder of Kite Pharma and co-founder of Bellco Capital, launched in August 2024 with $600m for life science-specific loans. "Life sciences VC Omega Funds closes $647m funding round" was originally created and published by Pharmaceutical Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data