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Hormel Foods Return-on-Tangible-Asset

: 18.05% (As of Jul. 2019)
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Return on tangible assets is calculated as Net Income divided by its average total tangible assets. Total tangible assets equals to Total Assets minus Intangible Assets. Hormel Foods's annualized Net Income for the quarter that ended in Jul. 2019 was USD 798 Mil. Hormel Foods's average total tangible assets for the quarter that ended in Jul. 2019 was USD 4,419 Mil. Therefore, Hormel Foods's annualized return on tangible assests (ROTA) for the quarter that ended in Jul. 2019 was 18.05%.

NYSE:HRL' s Return-on-Tangible-Asset Range Over the Past 10 Years
Min: 11.87   Max: 25.15
Current: 23.21

11.87
25.15

During the past 13 years, Hormel Foods's highest Return on Tangible Assets (ROTA) was 25.15%. The lowest was 11.87%. And the median was 15.38%.

NYSE:HRL's Return-on-Tangible-Asset is ranked higher than
95% of the 1655 Companies
in the Consumer Packaged Goods industry.

( Industry Median: 2.96 vs. NYSE:HRL: 23.21 )

Hormel Foods Return-on-Tangible-Asset Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Hormel Foods Annual Data
Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Oct15 Oct16 Oct17 Oct18
Return-on-Tangible-Asset Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 16.56 18.83 24.57 22.70 25.15

Hormel Foods Quarterly Data
Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19
Return-on-Tangible-Asset 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 21.65 25.68 22.84 26.14 18.05

Competitive Comparison
* 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.


Hormel Foods Return-on-Tangible-Asset Distribution

* The bar in red indicates where Hormel Foods's Return-on-Tangible-Asset falls into.



Hormel Foods Return-on-Tangible-Asset Calculation

Hormel Foods's annualized Return on Tangible Assets (ROTA) for the fiscal year that ended in Oct. 2018 is calculated as:

ROTA=Net Income/( (Total Tangible Assets+Total Tangible Assets)/ 2 )
(A: Oct. 2018 )  (A: Oct. 2017 )(A: Oct. 2018 )
=Net Income/( (Total Assets - Intangible Assets+Total Assets - Intangible Assets)/ 2 )
(A: Oct. 2018 )  (A: Oct. 2017 )(A: Oct. 2018 )
=1012.14/( (3829.081+4220.957)/ 2 )
=1012.14/4025.019
=25.15 %

Hormel Foods's annualized Return on Tangible Assets (ROTA) for the quarter that ended in Jul. 2019 is calculated as:

ROTA=Net Income/( (Total Tangible Assets+Total Tangible Assets)/ 2 )
(Q: Jul. 2019 )  (Q: Apr. 2019 )(Q: Jul. 2019 )
=Net Income/( (Total Assets - Intangible Assets+Total Assets - Intangible Assets)/ 2 )
(Q: Jul. 2019 )  (Q: Apr. 2019 )(Q: Jul. 2019 )
=797.796/( (4408.718+4429.16)/ 2 )
=797.796/4418.939
=18.05 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

In the calculation of annual return on tangible assets, the net income of the last fiscal year and the average total tangible assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Jul. 2019) net income data.


Hormel Foods  (NYSE:HRL) Return-on-Tangible-Asset Explanation

Return on tangible assets (ROTA) measures the rate of return on the average total tangible assets (total assets minus intangible assets). Tangible means physical in nature. Intangible Assets are assets that are not physical in nature, and typically "derive their value from legal or intellectual rights." ROTA measures a firm's efficiency at generating profits from its tangible assets. ROTA shows how well a company uses what it has to generate earnings. ROTAs can vary drastically across industries. Therefore, return on tangible assets should not be used to compare companies in different industries.


Be Aware

Like ROE and ROA, ROTA 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. ROTA can be affected by events such as stock buyback or issuance, and by a company’s tax rate and its interest payment. ROTA 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 ROTA may indicate vulnerability in the durability of the competitive advantage.


Hormel Foods Return-on-Tangible-Asset Related Terms

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