Here’s what Motorola Solutions, Inc.’s ROCE can tell us

Yahoo Finance takes a look at Motorola Solutions, Inc. (NYSE:MSI) and reflects on its potential as an investment. To be precise, Yahoo Finance said: Consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business. Firstly, we’ll go over how we calculate ROCE. Second, we’ll look at its ROCE compared to similar companies. And finally, we’ll look at how its current liabilities are impacting its ROCE. ROCE is commonly used for comparing the performance of similar businesses. Using our data, we find that Motorola Solutions’s ROCE is meaningfully better than the 7.5% average in the Communications industry. We would consider this a positive, as it suggests it is using capital more effectively than other similar companies. Putting aside its position relative to its industry for now, in absolute terms, Motorola Solutions’s ROCE is currently very good. In our analysis,

Motorola Solutions’s ROCE appears to be 25%, compared to 3 years ago, when its ROCE was 18%. This makes us think the business might be improving.

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