Latest news with #RM62m
Yahoo
23-04-2025
- Business
- Yahoo
Capital Allocation Trends At Aurelius Technologies Berhad (KLSE:ATECH) Aren't Ideal
If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Amongst other things, we'll want to see two things; firstly, a growing return on capital employed (ROCE) and secondly, an expansion in the company's amount of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. However, after briefly looking over the numbers, we don't think Aurelius Technologies Berhad (KLSE:ATECH) 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 2 warning signs investors should be aware of before investing in Aurelius Technologies Berhad. Read for free now. Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. Analysts use this formula to calculate it for Aurelius Technologies Berhad: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.12 = RM62m ÷ (RM660m - RM155m) (Based on the trailing twelve months to December 2024). Therefore, Aurelius Technologies Berhad has an ROCE of 12%. That's a pretty standard return and it's in line with the industry average of 12%. See our latest analysis for Aurelius Technologies Berhad Above you can see how the current ROCE for Aurelius Technologies Berhad compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Aurelius Technologies Berhad . We weren't thrilled with the trend because Aurelius Technologies Berhad's ROCE has reduced by 61% over the last five years, while the business employed 346% more capital. Usually this isn't ideal, but given Aurelius Technologies Berhad conducted a capital raising before their most recent earnings announcement, that would've likely contributed, at least partially, to the increased capital employed figure. The funds raised likely haven't been put to work yet so it's worth watching what happens in the future with Aurelius Technologies Berhad's earnings and if they change as a result from the capital raise. On a side note, Aurelius Technologies Berhad has done well to pay down its current liabilities to 23% of total assets. So we could link some of this to the decrease in ROCE. What's more, this can reduce some aspects of risk to the business because now the company's suppliers or short-term creditors are funding less of its operations. 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, despite lower returns in the short term, we're encouraged to see that Aurelius Technologies Berhad is reinvesting for growth and has higher sales as a result. And the stock has done incredibly well with a 106% return over the last three years, so long term investors are no doubt ecstatic with that result. So while the underlying trends could already be accounted for by investors, we still think this stock is worth looking into further. If you'd like to know more about Aurelius Technologies Berhad, we've spotted 2 warning signs, and 1 of them is a bit unpleasant. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. 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
04-04-2025
- Business
- Yahoo
We Like These Underlying Return On Capital Trends At BLD Plantation Bhd (KLSE:BLDPLNT)
Finding a business that has the potential to grow substantially is not easy, but it is possible if we look at a few key financial metrics. 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. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. So on that note, BLD Plantation Bhd (KLSE:BLDPLNT) looks quite promising in regards to its trends of return on capital. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. The formula for this calculation on BLD Plantation Bhd is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.065 = RM62m ÷ (RM1.2b - RM299m) (Based on the trailing twelve months to December 2024). Thus, BLD Plantation Bhd has an ROCE of 6.5%. Ultimately, that's a low return and it under-performs the Food industry average of 9.7%. View our latest analysis for BLD Plantation Bhd 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 BLD Plantation Bhd has performed in the past in other metrics, you can view this free graph of BLD Plantation Bhd's past earnings, revenue and cash flow . The fact that BLD Plantation Bhd is now generating some pre-tax profits from its prior investments is very encouraging. The company was generating losses five years ago, but now it's earning 6.5% which is a sight for sore eyes. And unsurprisingly, like most companies trying to break into the black, BLD Plantation Bhd is utilizing 26% more capital than it was five years ago. This can tell us that the company has plenty of reinvestment opportunities that are able to generate higher returns. In summary, it's great to see that BLD Plantation Bhd has managed to break into profitability and is continuing to reinvest in its business. Since the stock has returned a staggering 104% to shareholders over the last five years, it looks like investors are recognizing these changes. So given the stock has proven it has promising trends, it's worth researching the company further to see if these trends are likely to persist. One more thing, we've spotted 1 warning sign facing BLD Plantation Bhd that you might find interesting. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. 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
17-03-2025
- Business
- Yahoo
Will Weakness in HE Group Berhad's (KLSE:HEGROUP) Stock Prove Temporary Given Strong Fundamentals?
With its stock down 41% over the past three months, it is easy to disregard HE Group Berhad (KLSE:HEGROUP). 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. Specifically, we decided to study HE Group Berhad's ROE in this article. 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. See our latest analysis for HE Group Berhad ROE 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 HE Group Berhad is: 22% = RM14m ÷ RM62m (Based on the trailing twelve months to December 2024). The 'return' is the amount earned after tax over the last twelve months. That means that for every MYR1 worth of shareholders' equity, the company generated MYR0.22 in profit. So far, we've learned that ROE is a measure of a company's profitability. 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. At first glance, HE Group Berhad seems to have a decent ROE. On comparing with the average industry ROE of 8.3% the company's ROE looks pretty remarkable. This probably laid the ground for HE Group Berhad's significant 38% net income growth seen over the past five years. We reckon that there could also be other factors at play here. For example, it is possible that the company's management has made some good strategic decisions, or that the company has a low payout ratio. Next, on comparing with the industry net income growth, we found that HE Group Berhad's growth is quite high when compared to the industry average growth of 16% in the same period, which is great to see. The basis for attaching value to a company is, to a great extent, tied to its earnings growth. It's important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). This then helps them determine if the stock is placed for a bright or bleak future. Is HE Group Berhad fairly valued compared to other companies? These 3 valuation measures might help you decide. HE Group Berhad has a really low three-year median payout ratio of 13%, meaning that it has the remaining 87% left over to reinvest into its business. So it seems like the management is reinvesting profits heavily to grow its business and this reflects in its earnings growth number. Along with seeing a growth in earnings, HE Group Berhad only recently started paying dividends. Its quite possible that the company was looking to impress its shareholders. On the whole, we feel that HE Group Berhad's performance has been quite good. In particular, it's great to see that the company is investing heavily into its business and along with a high rate of return, that has resulted in a sizeable growth in its earnings. 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. To know the 1 risk we have identified for HE Group Berhad visit our risks dashboard for free. 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
10-03-2025
- Business
- Yahoo
Returns At TASCO Berhad (KLSE:TASCO) Are On The Way Up
To find a multi-bagger stock, what are the underlying trends we should look for in a business? Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. Put simply, these types of businesses are compounding machines, meaning they are continually reinvesting their earnings at ever-higher rates of return. With that in mind, we've noticed some promising trends at TASCO Berhad (KLSE:TASCO) so let's look a bit deeper. Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. The formula for this calculation on TASCO Berhad is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.064 = RM62m ÷ (RM1.9b - RM977m) (Based on the trailing twelve months to December 2024). Thus, TASCO Berhad has an ROCE of 6.4%. On its own that's a low return on capital but it's in line with the industry's average returns of 6.3%. Check out our latest analysis for TASCO Berhad Above you can see how the current ROCE for TASCO Berhad compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like, you can check out the forecasts from the analysts covering TASCO Berhad for free. TASCO Berhad's ROCE growth is quite impressive. More specifically, while the company has kept capital employed relatively flat over the last five years, the ROCE has climbed 62% in that same time. Basically the business is generating higher returns from the same amount of capital and that is proof that there are improvements in the company's efficiencies. On that front, things are looking good so it's worth exploring what management has said about growth plans going forward. For the record though, there was a noticeable increase in the company's current liabilities over the period, so we would attribute some of the ROCE growth to that. Effectively this means that suppliers or short-term creditors are now funding 50% of the business, which is more than it was five years ago. And with current liabilities at those levels, that's pretty high. As discussed above, TASCO Berhad appears to be getting more proficient at generating returns since capital employed has remained flat but earnings (before interest and tax) are up. And with the stock having performed exceptionally well over the last five years, these patterns are being accounted for by investors. Therefore, we think it would be worth your time to check if these trends are going to continue. On a separate note, we've found 1 warning sign for TASCO Berhad you'll probably want to know about. If you want to search for solid companies with great earnings, check out this free list of companies with good balance sheets and impressive returns on equity. 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
18-02-2025
- Business
- Yahoo
Here's What's Concerning About Solarvest Holdings Berhad's (KLSE:SLVEST) Returns On Capital
What are the early trends we should look for to identify a stock that could multiply in value over the long term? Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. Put simply, these types of businesses are compounding machines, meaning they are continually reinvesting their earnings at ever-higher rates of return. However, after investigating Solarvest Holdings Berhad (KLSE:SLVEST), we don't think it's current trends fit the mold of a multi-bagger. If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. To calculate this metric for Solarvest Holdings Berhad, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.13 = RM62m ÷ (RM610m - RM133m) (Based on the trailing twelve months to September 2024). So, Solarvest Holdings Berhad has an ROCE of 13%. That's a relatively normal return on capital, and it's around the 11% generated by the Electrical industry. View our latest analysis for Solarvest Holdings Berhad Above you can see how the current ROCE for Solarvest Holdings Berhad compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Solarvest Holdings Berhad . We weren't thrilled with the trend because Solarvest Holdings Berhad's ROCE has reduced by 45% over the last five years, while the business employed 587% more capital. That being said, Solarvest Holdings Berhad raised some capital prior to their latest results being released, so that could partly explain the increase in capital employed. It's unlikely that all of the funds raised have been put to work yet, so as a consequence Solarvest Holdings Berhad might not have received a full period of earnings contribution from it. On a side note, Solarvest Holdings Berhad has done well to pay down its current liabilities to 22% of total assets. So we could link some of this to the decrease in ROCE. What's more, this can reduce some aspects of risk to the business because now the company's suppliers or short-term creditors are funding less of its operations. Since the business is basically funding more of its operations with it's own money, you could argue this has made the business less efficient at generating ROCE. We're a bit apprehensive about Solarvest Holdings Berhad because despite more capital being deployed in the business, returns on that capital and sales have both fallen. Yet despite these poor fundamentals, the stock has gained a huge 116% over the last five years, so investors appear very optimistic. Regardless, we don't feel too comfortable with the fundamentals so we'd be steering clear of this stock for now. If you're still interested in Solarvest Holdings Berhad it's worth checking out our to see if it's trading at an attractive price in other respects. While Solarvest 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. Sign in to access your portfolio
