Return on Capital Employed Overview: Accel Entertainment, Inc.

After pulling data from Benzinga Pro it seems like during Q2, Accel Entertainment, Inc. ACEL earned $24.93 million, a 160.88% increase from the preceding quarter. Accel Entertainment, Inc. also posted a total of $201.97 million in sales, a 37.33% increase since Q1. In Q1, Accel Entertainment, Inc. earned $9.55 million, and total sales reached $147.07 million.

Why ROCE Is Significant

Changes in earnings and sales indicate shifts in Accel Entertainment, Inc.'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, Accel Entertainment, Inc. posted an ROCE of 0.16%.

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.

ROCE is an important metric for the comparison of similar companies. A relatively high ROCE shows Accel Entertainment, Inc. is potentially operating at a higher level of efficiency than other companies in its industry. If the company is generating high profits with its current level of capital, some of that money can be reinvested in more capital which will generally lead to higher returns and earnings per share growth.

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

Analyst Predictions

Accel Entertainment, Inc. reported Q2 earnings per share at $0.13/share, which did not meet analyst predictions of $0.2/share.