WEBULL

Investors Should Be Encouraged By Nomura Micro Science's (TSE:6254) Returns On Capital

Simply Wall St · 1d ago

If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an eye out for. Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. With that in mind, the ROCE of Nomura Micro Science (TSE:6254) looks great, so lets see what the trend can tell us.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Understanding Return On Capital Employed (ROCE)

For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. Analysts use this formula to calculate it for Nomura Micro Science:

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

0.43 = JP¥17b ÷ (JP¥104b - JP¥65b) (Based on the trailing twelve months to September 2025).

So, Nomura Micro Science has an ROCE of 43%. That's a fantastic return and not only that, it outpaces the average of 7.9% earned by companies in a similar industry.

See our latest analysis for Nomura Micro Science

roce
TSE:6254 Return on Capital Employed December 16th 2025

Above you can see how the current ROCE for Nomura Micro Science compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Nomura Micro Science .

What Does the ROCE Trend For Nomura Micro Science Tell Us?

We like the trends that we're seeing from Nomura Micro Science. The numbers show that in the last five years, the returns generated on capital employed have grown considerably to 43%. Basically the business is earning more per dollar of capital invested and in addition to that, 236% more capital is being employed now too. So we're very much inspired by what we're seeing at Nomura Micro Science thanks to its ability to profitably reinvest capital.

For the record though, there was a noticeable increase in the company's current liabilities over the period, so we would attribute some of the ROCE growth to that. Effectively this means that suppliers or short-term creditors are now funding 62% of the business, which is more than it was five years ago. And with current liabilities at those levels, that's pretty high.

In Conclusion...

To sum it up, Nomura Micro Science has proven it can reinvest in the business and generate higher returns on that capital employed, which is terrific. And with the stock having performed exceptionally well over the last five years, these patterns are being accounted for by investors. In light of that, we think it's worth looking further into this stock because if Nomura Micro Science can keep these trends up, it could have a bright future ahead.

Nomura Micro Science does come with some risks though, we found 4 warning signs in our investment analysis, and 2 of those are concerning...

If you want to search for more stocks that have been earning high returns, check out this free list of stocks with solid balance sheets that are also earning high returns on equity.