BREAKOUT... NEXT STOP $13, page-150

The article was failing to link so here in the core of it:
What Is 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. To calculate this metric for AGL Energy, this is the formula:

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

0.12 = AU$1.3b ÷ (AU$15b - AU$4.1b)(Based on the trailing twelve months to December 2024).

Therefore,AGL Energy has an ROCE of 12%.On its own, that's a standard return, however it's much better than the 5.3% generated by the Integrated Utilities industry.

View our latest analysis for AGL Energy

ASX:AGL Return on Capital Employed April 12th 2025

Above you can see how the current ROCE for AGL Energy 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 ourfree analyst report for AGL Energy.

So How Is AGL Energy's ROCE Trending?

Over the past five years, AGL Energy's ROCE and capital employed have both remained mostly flat. It's not uncommon to see this when looking at a mature and stable business that isn't re-investing its earnings because it has likely passed that phase of the business cycle. So unless we see a substantial change at AGL Energy in terms of ROCE and additional investments being made, we wouldn't hold our breath on it being a multi-bagger. With fewer investment opportunities, it makes sense that AGL Energy has been paying out a decent 54% of its earnings to shareholders. Unless businesses have highly compelling growth opportunities, they'll typically return some money to shareholders.

Our Take On AGL Energy's ROCE

We can conclude that in regards to AGL Energy's returns on capital employed and the trends, there isn't much change to report on. Since the stock has declined 24% over the last five years, investors may not be too optimistic on this trend improving either. On the whole, we aren't too inspired by the underlying trends and we think there may be better chances of finding a multi-bagger elsewhere.

My Take: Super contributions are increasing July 1st so AGL may benefit from that. It appears better place than Origin to mostly if not completely transition to renewable power generation.