Returns Are Gaining Momentum At Centrale d'Achat Française pour l'Outre-Mer Société Anonyme (EPA:CAFO)
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. Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. Speaking of which, we noticed some great changes in Centrale d'Achat Française pour l'Outre-Mer Société Anonyme's (EPA:CAFO) returns on capital, so let's have a look. What is Return On Capital Employed (ROCE)?
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 ...