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LexinFintech Holdings (NAS:LX) ROA %

: 5.56% (As of Mar. 2023)
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ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. LexinFintech Holdings's annualized Net Income for the quarter that ended in Mar. 2023 was $190 Mil. LexinFintech Holdings's average Total Assets over the quarter that ended in Mar. 2023 was $3,418 Mil. Therefore, LexinFintech Holdings's annualized ROA % for the quarter that ended in Mar. 2023 was 5.56%.

The historical rank and industry rank for LexinFintech Holdings's ROA % or its related term are showing as below:

LX' s ROA % Range Over the Past 10 Years
Min: -8.13   Med: 3.35   Max: 14.37
Current: 4.62

During the past 8 years, LexinFintech Holdings's highest ROA % was 14.37%. The lowest was -8.13%. And the median was 3.35%.

LX's ROA % is ranked better than
78.09% of 534 companies
in the Credit Services industry
Industry Median: 1.56 vs LX: 4.62

LexinFintech Holdings ROA % Historical Data

The historical data trend for LexinFintech Holdings's ROA % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

LexinFintech Holdings Annual Data
Trend Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22
ROA %
Premium Member Only Premium Member Only Premium Member Only 14.20 14.37 3.11 11.43 3.58

LexinFintech Holdings Quarterly Data
Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23
ROA % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.48 2.97 4.80 5.31 5.56

Competitive Comparison

For the Credit Services subindustry, LexinFintech Holdings's ROA %, along with its competitors' market caps and ROA % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

LexinFintech Holdings ROA % Distribution

For the Credit Services industry and Financial Services sector, LexinFintech Holdings's ROA % distribution charts can be found below:

* The bar in red indicates where LexinFintech Holdings's ROA % falls in comparison to its industry or sector. The grey bar indicates the ROA %'s extreme value range as defined by GuruFocus.



LexinFintech Holdings ROA % Calculation

LexinFintech Holdings's annualized ROA % for the fiscal year that ended in Dec. 2022 is calculated as:

ROA %=Net Income (A: Dec. 2022 )/( (Total Assets (A: Dec. 2021 )+Total Assets (A: Dec. 2022 ))/ count )
=117.583/( (3301.178+3266.162)/ 2 )
=117.583/3283.67
=3.58 %

LexinFintech Holdings's annualized ROA % for the quarter that ended in Mar. 2023 is calculated as:

ROA %=Net Income (Q: Mar. 2023 )/( (Total Assets (Q: Dec. 2022 )+Total Assets (Q: Mar. 2023 ))/ count )
=190.1/( (3266.162+3569.556)/ 2 )
=190.1/3417.859
=5.56 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Mar. 2023) net income data. ROA % is displayed in the 30-year financial page.


LexinFintech Holdings  (NAS:LX) ROA % Explanation

ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A bank’s ROA % is typically well under 2%.

Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:

ROA %(Q: Mar. 2023 )
=Net Income/Total Assets
=190.1/3417.859
=(Net Income / Revenue)*(Revenue / Total Assets)
=(190.1 / 1731.5)*(1731.5 / 3417.859)
=Net Margin %*Asset Turnover
=10.98 %*0.5066
=5.56 %

Note: The Net Income data used here is four times the quarterly (Mar. 2023) net income data. The Revenue data used here is four times the quarterly (Mar. 2023) revenue data.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).

Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.

E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.


LexinFintech Holdings ROA % Related Terms

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LexinFintech Holdings (NAS:LX) Business Description

LexinFintech Holdings logo
Traded in Other Exchanges
Address
No. 3099 Keyuan South Road, 27th Floor, China Energy Storage Tower, Nanshan District, Shenzhen, CHN, 518057
LexinFintech Holdings Ltd is an online consumer finance platform and a technology-driven service provider in China. The group is engaged primarily in online direct sales services and online consumer financial services for its customers in China. It offers online direct sales with installment payment terms and offers installment purchase loans and personal installment loans mainly through its retail and online consumer finance platform www.fenqile.com, and its mobile application to young adults between the age of 18 and 36 in the People's Republic of China. The company also finances the loans with proceeds from partnering peer-to-peer lending platforms, commercial banks, and other financial institutions. Geographically, it derives revenue from China.

LexinFintech Holdings (NAS:LX) Headlines

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