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IMPACT Silver (CVE:IPT) Is Doing The Right Things To Multiply Its Share Price

Simply Wall St · 1d ago

If you're looking for a multi-bagger, there's a few things to keep an eye out for. One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing amount of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. With that in mind, we've noticed some promising trends at IMPACT Silver (CVE:IPT) so let's look a bit deeper.

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What Is Return On Capital Employed (ROCE)?

For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Analysts use this formula to calculate it for IMPACT Silver:

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

0.021 = CA$1.4m ÷ (CA$72m - CA$5.7m) (Based on the trailing twelve months to September 2025).

Therefore, IMPACT Silver has an ROCE of 2.1%. Ultimately, that's a low return and it under-performs the Metals and Mining industry average of 4.5%.

See our latest analysis for IMPACT Silver

roce
TSXV:IPT Return on Capital Employed December 29th 2025

While the past is not representative of the future, it can be helpful to know how a company has performed historically, which is why we have this chart above. If you'd like to look at how IMPACT Silver has performed in the past in other metrics, you can view this free graph of IMPACT Silver's past earnings, revenue and cash flow.

What Can We Tell From IMPACT Silver's ROCE Trend?

While the ROCE isn't as high as some other companies out there, it's great to see it's on the up. Looking at the data, we can see that even though capital employed in the business has remained relatively flat, the ROCE generated has risen by 402% over the last five years. So our take on this is that the business has increased efficiencies to generate these higher returns, all the while not needing to make any additional investments. On that front, things are looking good so it's worth exploring what management has said about growth plans going forward.

The Bottom Line

As discussed above, IMPACT Silver appears to be getting more proficient at generating returns since capital employed has remained flat but earnings (before interest and tax) are up. Astute investors may have an opportunity here because the stock has declined 64% in the last five years. So researching this company further and determining whether or not these trends will continue seems justified.

IMPACT Silver does come with some risks though, we found 3 warning signs in our investment analysis, and 2 of those are concerning...

While IMPACT Silver may not currently earn the highest returns, we've compiled a list of companies that currently earn more than 25% return on equity. Check out this free list here.