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Arcadis (AMS:ARCAD) Is Experiencing Growth In Returns On Capital

Simply Wall St · 5d ago

If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Amongst other things, we'll want to see two things; firstly, a growing return on capital employed (ROCE) and secondly, an expansion in the company's amount of capital employed. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. With that in mind, we've noticed some promising trends at Arcadis (AMS:ARCAD) so let's look a bit deeper.

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Return On Capital Employed (ROCE): What Is It?

Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. The formula for this calculation on Arcadis is:

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

0.17 = €390m ÷ (€3.9b - €1.5b) (Based on the trailing twelve months to June 2025).

Thus, Arcadis has an ROCE of 17%. On its own, that's a standard return, however it's much better than the 11% generated by the Professional Services industry.

Check out our latest analysis for Arcadis

roce
ENXTAM:ARCAD Return on Capital Employed January 6th 2026

Above you can see how the current ROCE for Arcadis compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like to see what analysts are forecasting going forward, you should check out our free analyst report for Arcadis .

So How Is Arcadis' ROCE Trending?

Investors would be pleased with what's happening at Arcadis. The data shows that returns on capital have increased substantially over the last five years to 17%. The amount of capital employed has increased too, by 32%. So we're very much inspired by what we're seeing at Arcadis thanks to its ability to profitably reinvest capital.

Our Take On Arcadis' ROCE

To sum it up, Arcadis has proven it can reinvest in the business and generate higher returns on that capital employed, which is terrific. Considering the stock has delivered 37% to its stockholders over the last five years, it may be fair to think that investors aren't fully aware of the promising trends yet. So with that in mind, we think the stock deserves further research.

One more thing, we've spotted 3 warning signs facing Arcadis that you might find interesting.

While Arcadis isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets.