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Hormel Foods Return-on-Tangible-Equity

: 33.72%% (As of Jul. 2019)
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Return on tangible equity is calculated as Net Income attributable to Common Stockholders divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Hormel Foods's annualized net income attributable to common stockholders for the quarter that ended in Jul. 2019 was $798 Mil. Hormel Foods's average shareholder tangible equity for the quarter that ended in Jul. 2019 was $2,366 Mil. Therefore, Hormel Foods's annualized return on tangible equity (ROTE) for the quarter that ended in Jul. 2019 was 33.72 %%.

NYSE:HRL' s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 25.26   Max: 58.36
Current: 51.23

25.26
58.36

During the past 13 years, Hormel Foods's highest Return on Tangible Equity (ROTE) was 58.36%. The lowest was 25.26%. And the median was 29.22%.

NYSE:HRL's Return-on-Tangible-Equity is ranked higher than
91% of the 1566 Companies
in the Consumer Packaged Goods industry.

( Industry Median: 7.12 vs. NYSE:HRL: 51.23 )

Hormel Foods Return-on-Tangible-Equity 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-Equity Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 31.53 41.63 55.95 48.39 58.36

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-Equity 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 61.74 67.47 55.83 54.44 33.72

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-Equity Distribution

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



Hormel Foods Return-on-Tangible-Equity Calculation

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

ROTE=Net Income attributable to Common Stockholders/( (Total Tangible Equity+Total Tangible Equity)/ 2 )
(A: Oct. 2018 )  (A: Oct. 2017 )(A: Oct. 2018 )
=Net Income attributable to Common Stockholders/( (Total Stockholders Equity - Intangible Assets+Total Stockholders Equity - Intangible Assets )/ 2 )
(A: Oct. 2018 )  (A: Oct. 2017 )(A: Oct. 2018 )
=1012.14/( (1789.08+1679.476 )/ 2 )
=1012.14/1734.278
=58.36 % %

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

ROTE=Net Income attributable to Common Stockholders/( (Total Tangible Equity+Total Tangible Equity)/ 2 )
(Q: Jul. 2019 )  (Q: Apr. 2019 )(Q: Jul. 2019 )
=Net Income attributable to Common Stockholders/( (Total Stockholders Equity - Intangible Assets+Total Stockholders Equity - Intangible Assets)/ 2 )
(Q: Jul. 2019 )  (Q: Apr. 2019 )(Q: Jul. 2019 )
=797.796/( (2370.309+2361.655)/ 2 )
=797.796/2365.982
=33.72 % %

* 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 equity, the net income attributable to common stockholders of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data, the net income attributable to common stockholders data used here is four times the quarterly (Jul. 2019) net income attributable to common stockholders data. Return on Equity is displayed in the 10-year financial page.


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

Return on Tangible Equity (ROTE) measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). ROTE shows how well a company uses investment funds to generate earnings growth. ROTEs between 15% and 20% are considered desirable.


Be Aware

Net income attributable to common stockholders is used.

Because a company can increase its return on tangible equity by having more financial leverage, it is important to watch the leverage ratio when investing in high ROTE companies. Like Return-on-Tangible-Asset, ROTE is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Asset light businesses require very few assets to generate very high earnings. Their ROTEs can be extremely high.


Hormel Foods Return-on-Tangible-Equity Related Terms

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