Return Trends At Operadora de Sites Mexicanos. de (BMV:SITES1A-1) Aren't Appealing

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. In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. Although, when we looked at Operadora de Sites Mexicanos. de (BMV:SITES1A-1), it didn't seem to tick all of these boxes.

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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 formula to calculate it for Operadora de Sites Mexicanos. de:

Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)

0.066 = Mex$5.9b ÷ (Mex$105b - Mex$16b) (Based on the trailing twelve months to June 2025).

Thus, Operadora de Sites Mexicanos. de has an ROCE of 6.6%. Ultimately, that's a low return and it under-performs the Telecom industry average of 8.3%.

View our latest analysis for Operadora de Sites Mexicanos. de

In the above chart we have measured Operadora de Sites Mexicanos. de's prior ROCE against its prior performance, but the future is arguably more important. If you're interested, you can view the analysts predictions in our free analyst report for Operadora de Sites Mexicanos. de .

So How Is Operadora de Sites Mexicanos. de's ROCE Trending?

The returns on capital haven't changed much for Operadora de Sites Mexicanos. de in recent years. Over the past five years, ROCE has remained relatively flat at around 6.6% and the business has deployed 69% more capital into its operations. This poor ROCE doesn't inspire confidence right now, and with the increase in capital employed, it's evident that the business isn't deploying the funds into high return investments.

The Bottom Line

In conclusion, Operadora de Sites Mexicanos. de has been investing more capital into the business, but returns on that capital haven't increased. Additionally, the stock's total return to shareholders over the last three years has been flat, which isn't too surprising. On the whole, we aren't too inspired by the underlying trends and we think there may be better chances of finding a multi-bagger elsewhere.

On a final note, we've found 1 warning sign for Operadora de Sites Mexicanos. de that we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.