Custom Truck One Source's (NYSE:CTOS) ROCE Trends and Implications for Investors

Custom Truck One Source's (NYSE:CTOS) return on capital employed (ROCE) has increased from 2.7% to 5.2% in the last five years. However, the ROCE remains low and underperforms the Trade Distributors industry average of 12%. Despite this, the company has been able to profitably reinvest capital, which is reflected in the growth of ROCE and the increase in the amount of capital employed. The improvement in ROCE is partly fueled by an increase in current liabilities, which increases risk.