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    Aya Gold & Silver (TSE:AYA) Is Doing The Right Things To Multiply Its Share Price

    Simply Wall St·01/07/2026 11:25:14
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    If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Amongst other things, we'll want to see two things; firstly, a growing return on capital employed (ROCE) and secondly, an expansion in the company's amount of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. With that in mind, we've noticed some promising trends at Aya Gold & Silver (TSE:AYA) so let's look a bit deeper.

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    Return On Capital Employed (ROCE): What Is It?

    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 Aya Gold & Silver, this is the formula:

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

    0.034 = US$17m ÷ (US$585m - US$100m) (Based on the trailing twelve months to September 2025).

    So, Aya Gold & Silver has an ROCE of 3.4%. In absolute terms, that's a low return and it also under-performs the Metals and Mining industry average of 4.4%.

    See our latest analysis for Aya Gold & Silver

    roce
    TSX:AYA Return on Capital Employed January 7th 2026

    Above you can see how the current ROCE for Aya Gold & Silver compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Aya Gold & Silver .

    The Trend Of ROCE

    We're delighted to see that Aya Gold & Silver is reaping rewards from its investments and is now generating some pre-tax profits. Shareholders would no doubt be pleased with this because the business was loss-making five years ago but is is now generating 3.4% on its capital. Not only that, but the company is utilizing 712% more capital than before, but that's to be expected from a company trying to break into profitability. This can indicate that there's plenty of opportunities to invest capital internally and at ever higher rates, both common traits of a multi-bagger.

    For the record though, there was a noticeable increase in the company's current liabilities over the period, so we would attribute some of the ROCE growth to that. Essentially the business now has suppliers or short-term creditors funding about 17% of its operations, which isn't ideal. Keep an eye out for future increases because when the ratio of current liabilities to total assets gets particularly high, this can introduce some new risks for the business.

    The Bottom Line

    In summary, it's great to see that Aya Gold & Silver has managed to break into profitability and is continuing to reinvest in its business. And a remarkable 434% total return over the last five years tells us that investors are expecting more good things to come in the future. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence.

    Like most companies, Aya Gold & Silver does come with some risks, and we've found 2 warning signs that you should be aware of.

    While Aya Gold & Silver may not currently earn the highest returns, we've compiled a list of companies that currently earn more than 25% return on equity. Check out this free list here.