When looking for stocks with the potential to multiply in value over the long term, it is important to identify early trends. Two key indicators to consider are a growing return on capital employed (ROCE) and an increasing amount of capital employed. These trends show that a business is reinvesting profits at increasing rates of return.
Serinus Energy (LON:SENX) has caught our attention due to some promising trends. ROCE measures the amount of pre-tax profits a company can generate from its capital employed. Serinus Energy has an ROCE of 3.4%, which is relatively low and underperforms the industry average of 13%.
Serinus Energy plc (LON:SENX) is an international oil company with operations in Romania and Tunisia. The focus of the Company is to enhance shareholder value by growing oil and gas production through the efficient allocation of capital.