Latest news with #RM33m
Yahoo
29-07-2025
- Business
- Yahoo
Is WTEC Group Berhad's (KLSE:WTEC) ROE Of 25% Impressive?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. To keep the lesson grounded in practicality, we'll use ROE to better understand WTEC Group Berhad (KLSE:WTEC). Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. Put another way, it reveals the company's success at turning shareholder investments into profits. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. 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 WTEC Group Berhad is: 25% = RM8.2m ÷ RM33m (Based on the trailing twelve months to December 2024). The 'return' refers to a company's earnings over the last year. That means that for every MYR1 worth of shareholders' equity, the company generated MYR0.25 in profit. Check out our latest analysis for WTEC Group Berhad Does WTEC Group Berhad Have A Good ROE? One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, WTEC Group Berhad has a higher ROE than the average (6.9%) in the Chemicals industry. That is a good sign. Bear in mind, a high ROE doesn't always mean superior financial performance. Especially when a firm uses high levels of debt to finance its debt which may boost its ROE but the high leverage puts the company at risk. How Does Debt Impact ROE? Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. That will make the ROE look better than if no debt was used. Combining WTEC Group Berhad's Debt And Its 25% Return On Equity WTEC Group Berhad has a debt to equity ratio of just 0.047, which is very low. Its ROE is very impressive, and given only modest debt, this suggests the business is high quality. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises. Conclusion Return on equity is one way we can compare its business quality of different companies. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to take a peek at this data-rich interactive graph of forecasts for the company. Shop Top Mortgage Rates A quicker path to financial freedom Personalized rates in minutes Your Path to Homeownership Of course WTEC Group Berhad may not be the best stock to buy. So you may wish to see this free collection of other companies that have high ROE and low debt. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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.
Yahoo
10-07-2025
- Business
- Yahoo
Could The Market Be Wrong About Feytech Holdings Berhad (KLSE:FEYTECH) Given Its Attractive Financial Prospects?
With its stock down 17% over the past three months, it is easy to disregard Feytech Holdings Berhad (KLSE:FEYTECH). But if you pay close attention, you might gather that its strong financials could mean that the stock could potentially see an increase in value in the long-term, given how markets usually reward companies with good financial health. Particularly, we will be paying attention to Feytech Holdings Berhad's ROE today. Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors' money. Put another way, it reveals the company's success at turning shareholder investments into profits. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. Return on equity can be calculated by using the formula: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for Feytech Holdings Berhad is: 13% = RM33m ÷ RM246m (Based on the trailing twelve months to March 2025). The 'return' is the yearly profit. Another way to think of that is that for every MYR1 worth of equity, the company was able to earn MYR0.13 in profit. Check out our latest analysis for Feytech Holdings Berhad We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. Assuming everything else remains unchanged, the higher the ROE and profit retention, the higher the growth rate of a company compared to companies that don't necessarily bear these characteristics. At first glance, Feytech Holdings Berhad seems to have a decent ROE. Especially when compared to the industry average of 7.4% the company's ROE looks pretty impressive. This probably laid the ground for Feytech Holdings Berhad's moderate 19% net income growth seen over the past five years. Next, on comparing with the industry net income growth, we found that Feytech Holdings Berhad's reported growth was lower than the industry growth of 38% over the last few years, which is not something we like to see. Earnings growth is an important metric to consider when valuing a stock. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. This then helps them determine if the stock is placed for a bright or bleak future. One good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings prospects. So, you may want to check if Feytech Holdings Berhad is trading on a high P/E or a low P/E, relative to its industry. Overall, we are quite pleased with Feytech Holdings Berhad's performance. Particularly, we like that the company is reinvesting heavily into its business, and at a high rate of return. As a result, the decent growth in its earnings is not surprising. If the company continues to grow its earnings the way it has, that could have a positive impact on its share price given how earnings per share influence long-term share prices. Not to forget, share price outcomes are also dependent on the potential risks a company may face. So it is important for investors to be aware of the risks involved in the business. You can see the 2 risks we have identified for Feytech Holdings Berhad by visiting our risks dashboard for free on our platform here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. 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
29-04-2025
- Business
- Yahoo
Investors Could Be Concerned With GDB Holdings Berhad's (KLSE:GDB) Returns On Capital
If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an eye out for. In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. Having said that, from a first glance at GDB Holdings Berhad (KLSE:GDB) we aren't jumping out of our chairs at how returns are trending, but let's have a deeper look. We've discovered 4 warning signs about GDB Holdings Berhad. View them for free. If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. Analysts use this formula to calculate it for GDB Holdings Berhad: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.17 = RM33m ÷ (RM373m - RM177m) (Based on the trailing twelve months to December 2024). Therefore, GDB Holdings Berhad has an ROCE of 17%. On its own, that's a standard return, however it's much better than the 10.0% generated by the Construction industry. View our latest analysis for GDB Holdings Berhad While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you'd like to look at how GDB Holdings Berhad has performed in the past in other metrics, you can view this free graph of GDB Holdings Berhad's past earnings, revenue and cash flow. In terms of GDB Holdings Berhad's historical ROCE movements, the trend isn't fantastic. Around five years ago the returns on capital were 27%, but since then they've fallen to 17%. And considering revenue has dropped while employing more capital, we'd be cautious. If this were to continue, you might be looking at a company that is trying to reinvest for growth but is actually losing market share since sales haven't increased. On a separate but related note, it's important to know that GDB Holdings Berhad has a current liabilities to total assets ratio of 47%, which we'd consider pretty high. This effectively means that suppliers (or short-term creditors) are funding a large portion of the business, so just be aware that this can introduce some elements of risk. While it's not necessarily a bad thing, it can be beneficial if this ratio is lower. In summary, we're somewhat concerned by GDB Holdings Berhad's diminishing returns on increasing amounts of capital. Long term shareholders who've owned the stock over the last five years have experienced a 22% depreciation in their investment, so it appears the market might not like these trends either. Unless there is a shift to a more positive trajectory in these metrics, we would look elsewhere. If you'd like to know more about GDB Holdings Berhad, we've spotted 4 warning signs, and 2 of them can't be ignored. While GDB Holdings Berhad isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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.
Yahoo
22-04-2025
- Business
- Yahoo
Here's What's Concerning About Cnergenz Berhad's (KLSE:CNERGEN) Returns On Capital
There are a few key trends to look for if we want to identify the next multi-bagger. Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. However, after briefly looking over the numbers, we don't think Cnergenz Berhad (KLSE:CNERGEN) has the makings of a multi-bagger going forward, but let's have a look at why that may be. Our free stock report includes 4 warning signs investors should be aware of before investing in Cnergenz Berhad. Read for free now. For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Analysts use this formula to calculate it for Cnergenz Berhad: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.061 = RM10m ÷ (RM199m - RM33m) (Based on the trailing twelve months to December 2024). So, Cnergenz Berhad has an ROCE of 6.1%. In absolute terms, that's a low return and it also under-performs the Electronic industry average of 12%. View our latest analysis for Cnergenz Berhad While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you'd like to look at how Cnergenz Berhad has performed in the past in other metrics, you can view this free graph of Cnergenz Berhad's past earnings, revenue and cash flow. In terms of Cnergenz Berhad's historical ROCE movements, the trend isn't fantastic. Around five years ago the returns on capital were 48%, but since then they've fallen to 6.1%. Given the business is employing more capital while revenue has slipped, this is a bit concerning. This could mean that the business is losing its competitive advantage or market share, because while more money is being put into ventures, it's actually producing a lower return - "less bang for their buck" per se. On a related note, Cnergenz Berhad has decreased its current liabilities to 16% of total assets. That could partly explain why the ROCE has dropped. Effectively this means their suppliers or short-term creditors are funding less of the business, which reduces some elements of risk. Some would claim this reduces the business' efficiency at generating ROCE since it is now funding more of the operations with its own money. In summary, we're somewhat concerned by Cnergenz Berhad's diminishing returns on increasing amounts of capital. Long term shareholders who've owned the stock over the last year have experienced a 48% depreciation in their investment, so it appears the market might not like these trends either. With underlying trends that aren't great in these areas, we'd consider looking elsewhere. Since virtually every company faces some risks, it's worth knowing what they are, and we've spotted 4 warning signs for Cnergenz Berhad (of which 1 shouldn't be ignored!) that you should know about. While Cnergenz Berhad may not currently earn the highest returns, we've compiled a list of companies that currently earn more than 25% return on equity. Check out this free list here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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. Sign in to access your portfolio
Yahoo
22-04-2025
- Business
- Yahoo
Here's What's Concerning About Cnergenz Berhad's (KLSE:CNERGEN) Returns On Capital
There are a few key trends to look for if we want to identify the next multi-bagger. Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. However, after briefly looking over the numbers, we don't think Cnergenz Berhad (KLSE:CNERGEN) has the makings of a multi-bagger going forward, but let's have a look at why that may be. Our free stock report includes 4 warning signs investors should be aware of before investing in Cnergenz Berhad. Read for free now. For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Analysts use this formula to calculate it for Cnergenz Berhad: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.061 = RM10m ÷ (RM199m - RM33m) (Based on the trailing twelve months to December 2024). So, Cnergenz Berhad has an ROCE of 6.1%. In absolute terms, that's a low return and it also under-performs the Electronic industry average of 12%. View our latest analysis for Cnergenz Berhad While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you'd like to look at how Cnergenz Berhad has performed in the past in other metrics, you can view this free graph of Cnergenz Berhad's past earnings, revenue and cash flow. In terms of Cnergenz Berhad's historical ROCE movements, the trend isn't fantastic. Around five years ago the returns on capital were 48%, but since then they've fallen to 6.1%. Given the business is employing more capital while revenue has slipped, this is a bit concerning. This could mean that the business is losing its competitive advantage or market share, because while more money is being put into ventures, it's actually producing a lower return - "less bang for their buck" per se. On a related note, Cnergenz Berhad has decreased its current liabilities to 16% of total assets. That could partly explain why the ROCE has dropped. Effectively this means their suppliers or short-term creditors are funding less of the business, which reduces some elements of risk. Some would claim this reduces the business' efficiency at generating ROCE since it is now funding more of the operations with its own money. In summary, we're somewhat concerned by Cnergenz Berhad's diminishing returns on increasing amounts of capital. Long term shareholders who've owned the stock over the last year have experienced a 48% depreciation in their investment, so it appears the market might not like these trends either. With underlying trends that aren't great in these areas, we'd consider looking elsewhere. Since virtually every company faces some risks, it's worth knowing what they are, and we've spotted 4 warning signs for Cnergenz Berhad (of which 1 shouldn't be ignored!) that you should know about. While Cnergenz Berhad may not currently earn the highest returns, we've compiled a list of companies that currently earn more than 25% return on equity. Check out this free list here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) 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.
