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We Like These Underlying Return On Capital Trends At Brill Shoe Industries (TLV:BRIL)

Simply Wall St · 4d ago

There are a few key trends to look for if we want to identify the next multi-bagger. 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. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. So when we looked at Brill Shoe Industries (TLV:BRIL) and its trend of ROCE, we really liked what we saw.

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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 Brill Shoe Industries:

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

0.065 = ₪24m ÷ (₪605m - ₪237m) (Based on the trailing twelve months to September 2025).

Therefore, Brill Shoe Industries has an ROCE of 6.5%. Ultimately, that's a low return and it under-performs the Luxury industry average of 8.8%.

Check out our latest analysis for Brill Shoe Industries

roce
TASE:BRIL Return on Capital Employed January 5th 2026

Historical performance is a great place to start when researching a stock so above you can see the gauge for Brill Shoe Industries' ROCE against it's prior returns. If you'd like to look at how Brill Shoe Industries has performed in the past in other metrics, you can view this free graph of Brill Shoe Industries' past earnings, revenue and cash flow.

What The Trend Of ROCE Can Tell Us

Brill Shoe Industries is showing promise given that its ROCE is trending up and to the right. 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 1,261% over the last five years. So it's likely that the business is now reaping the full benefits of its past investments, since the capital employed hasn't changed considerably. It's worth looking deeper into this though because while it's great that the business is more efficient, it might also mean that going forward the areas to invest internally for the organic growth are lacking.

The Key Takeaway

In summary, we're delighted to see that Brill Shoe Industries has been able to increase efficiencies and earn higher rates of return on the same amount of capital. And with the stock having performed exceptionally well over the last five years, these patterns are being accounted for by investors. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence.

Brill Shoe Industries does have some risks, we noticed 4 warning signs (and 3 which make us uncomfortable) we think you should know about.

While Brill Shoe Industries 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.