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Is CEMEX, S.A.B. de C.V.'s (BMV:CEMEXCPO) Recent Stock Performance Influenced By Its Fundamentals In Any Way?

Simply Wall St · 12/23/2025 16:40

Most readers would already be aware that CEMEX. de's (BMV:CEMEXCPO) stock increased significantly by 26% over the past three months. We wonder if and what role the company's financials play in that price change as a company's long-term fundamentals usually dictate market outcomes. Particularly, we will be paying attention to CEMEX. de's ROE today.

ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In simpler terms, it measures the profitability of a company in relation to shareholder's equity.

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How Is ROE Calculated?

The formula for return on equity is:

Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity

So, based on the above formula, the ROE for CEMEX. de is:

6.7% = US$931m ÷ US$14b (Based on the trailing twelve months to September 2025).

The 'return' is the yearly profit. That means that for every MX$1 worth of shareholders' equity, the company generated MX$0.07 in profit.

See our latest analysis for CEMEX. de

What Has ROE Got To Do With Earnings Growth?

So far, we've learned that ROE is a measure of a company's profitability. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes.

CEMEX. de's Earnings Growth And 6.7% ROE

As you can see, CEMEX. de's ROE looks pretty weak. Not just that, even compared to the industry average of 8.6%, the company's ROE is entirely unremarkable. In spite of this, CEMEX. de was able to grow its net income considerably, at a rate of 49% in the last five years. Therefore, there could be other reasons behind this growth. For example, it is possible that the company's management has made some good strategic decisions, or that the company has a low payout ratio.

We then compared CEMEX. de's net income growth with the industry and we're pleased to see that the company's growth figure is higher when compared with the industry which has a growth rate of 11% in the same 5-year period.

past-earnings-growth
BMV:CEMEX CPO Past Earnings Growth December 23rd 2025

Earnings growth is a huge factor in stock valuation. It’s important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). Doing so will help them establish if the stock's future looks promising or ominous. If you're wondering about CEMEX. de's's valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry.

Is CEMEX. de Making Efficient Use Of Its Profits?

CEMEX. de's three-year median payout ratio is a pretty moderate 36%, meaning the company retains 64% of its income. This suggests that its dividend is well covered, and given the high growth we discussed above, it looks like CEMEX. de is reinvesting its earnings efficiently.

Additionally, CEMEX. de has paid dividends over a period of six years which means that the company is pretty serious about sharing its profits with shareholders.

Conclusion

In total, it does look like CEMEX. de has some positive aspects to its business. Even in spite of the low rate of return, the company has posted impressive earnings growth as a result of reinvesting heavily into its business. That being so, a study of the latest analyst forecasts show that the company is expected to see a slowdown in its future earnings growth. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more.