Insight guru • 10m
Company A is growing at 30% YOY and is available at current p/e of 75 , ROCE of 25% and gives a dividend yield of 1% Company B is growing at 15% YOY and is available at current p/e of 30, ROCE of 50% and gives a dividend yield of 3% Assuming both the companies are from the same sector, reinvest all the profits back into business after dividend payment , takes no debt, have the same enterprise value and profit after earnings today, in which company would you invest your money for the next 5 years?
Simplifying finance.... • 5d
ROCE is one of those metrics that quietly reveals business quality. I look at it as a simple test: For every ₹100 of capital a company uses, how much value does it actually generate? Revenue growth and profit numbers can look impressive, but ROCE
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