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If we want to find a potential multi-bag, there are often potential trends that can provide clues. In a perfect world, we want a company to invest more money in its business, and ideally the returns from that capital are also increasing. If you see it, it usually means it is a company with a great business model and a lot of profitable reinvestment opportunities. So, when we look at Experian (LON:expn) ROCE trends, we like what we see.
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For those who don’t know, ROCE is a measure of the company’s annual pre-tax profit (its return) relative to the capital used in the business. Analysts use this formula to calculate it as Experian:
Return on capital hired = income before interest and taxes (EBIT) ÷ (total assets – current liabilities)
0.19 = US $1.9B÷ (US $13B- US $3.0B) (Based on the twelve months to March 2025).
so, Experian's ROCE is 19%. It's a satisfying return from an absolute standpoint, but it's much better than the 13% average for the professional services industry.
See our latest analysis of Experian
LSE: Return on Capital Hired on August 10, 2025
In the figure above, we have measured that Experian's previous ROCE is opposite to previous performance, but the future is arguably more important. If you want to see which analysts predict the future, you should check out our free analyst reports.
Although the return on capital is good, they don’t have much action. Over the past five years, the company's capital has increased by 48%, and the return on that capital has remained stable at 19%. 19% is a very standard return, and knowing that Experian has been winning this amount, it offers some comfortable returns. Such returns may not be too exciting for a long time, but with consistency they can get rewards in terms of share price returns.
To sum up, with a good rate of return, Experian is just steadily reinvesting capital. Over the past five years, the stock has followed with shareholders returning 47% of shareholders. So, while investors may consider positive underlying trends, we still think the stock deserves further research.
One more thing, we discovered 1 warning sign You may find it interesting to face the experience.
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While Experian may not have achieved the highest returns at the moment, we have compiled a list of companies that currently earn 25% equity gains. Look at this Free Listed here.
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This article by Simply Wall ST is essentially general. We provide comments based on historical data, analysts use only unbiased approaches to forecasting, and our articles are not meant to be financial advice. It does not constitute a recommendation to buy or sell any shares, nor does it constitute your target or financial position. We aim to bring you long-term focus analysis driven by fundamental data. Please note that our analysis may not consider the latest price-sensitive company announcements or qualitative materials. Simple Wall ST has no place in any of the stocks mentioned.