Greenland Technologies Holding: A Strong ROCE Trend and Expanding Capital Employed

Greenland Technologies Holding (NASDAQ:GTEC) has reported a return on capital employed (ROCE) of 25%, outpacing the average of 11% in its industry. The company's ROCE has increased substantially over the last five years, and the amount of capital employed has also grown by 27%. This suggests that Greenland Technologies Holding is effectively making more money per dollar of capital used and has plenty of opportunities to invest capital internally at higher rates, a combination common among multi-baggers.

Greenland Technologies Holding (NASDAQ:GTEC) has reported a robust return on capital employed (ROCE) of 25%, significantly outperforming the industry average of 11%. This impressive ROCE is the result of a substantial increase in returns on capital over the last five years, reaching 25% from previous levels. Additionally, the company's capital employed has grown by 27%, indicating a strong ability to reinvest in profitable initiatives and maintain high returns on capital.

The company's ROCE trend is particularly noteworthy. Greenland Technologies Holding's ability to increase its returns on capital while expanding its capital base is a key indicator of growth potential. This suggests that the company is effectively using its capital to generate higher profits, a trait often seen in successful, high-growth companies.

However, it is essential to consider the high ratio of current liabilities to total assets, which stands at 47%. This high ratio could pose risks, as it indicates a significant reliance on short-term creditors. While this is not necessarily a red flag, it is something investors should be aware of when evaluating the company's financial health.

Despite the recent decline in stock price by 44% over the last five years, Greenland Technologies Holding's strong ROCE and growth in capital employed suggest that the company has potential for future growth. Investors should consider the company's current valuation and other financial metrics to make an informed decision.

References:
[1] https://simplywall.st/stocks/us/capital-goods/nasdaq-gtec/greenland-technologies-holding/news/greenland-technologies-holding-nasdaqgtec-is-investing-its-c