Benzinga | Aug 20, 2021 01:38PM EDT

Return on Capital Employed Insights for Owens-Illinois

After pulling data from Benzinga Pro it seems like during Q2, Owens-Illinois (NYSE:OI) earned $228.00 million, a 812.5% increase from the preceding quarter. Owens-Illinois also posted a total of $1.66 billion in sales, a 10.67% increase since Q1. Owens-Illinois collected $1.50 billion in revenue during Q1, but reported earnings showed a $32.00 million loss.

What Is Return On Capital Employed?

Changes in earnings and sales indicate shifts in Owens-Illinois's Return on Capital Employed, a measure of yearly pre-tax profit relative to capital employed by a business. Generally, a higher ROCE suggests successful growth of a company and is a sign of higher earnings per share in the future. In Q2, Owens-Illinois posted an ROCE of 0.45%.

It is important to keep in mind ROCE evaluates past performance and is not used as a predictive tool. It is a good measure of a company's recent performance, but several factors could affect earnings and sales in the near future.

Return on Capital Employed is an important measurement of efficiency and a useful tool when comparing companies that operate in the same industry. A relatively high ROCE indicates a company may be generating profits that can be reinvested into more capital, leading to higher returns and growing EPS for shareholders.

In Owens-Illinois's case, the positive ROCE ratio will be something investors pay attention to before making long-term financial decisions.

Analyst Predictions

Owens-Illinois reported Q2 earnings per share at $0.54/share, which beat analyst predictions of $0.47/share.