Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Zoom Video Communications's annualized net income for the quarter that ended in Jul. 2023 was $728 Mil. Zoom Video Communications's average shareholder tangible equity for the quarter that ended in Jul. 2023 was $6,377 Mil. Therefore, Zoom Video Communications's annualized Return-on-Tangible-Equity for the quarter that ended in Jul. 2023 was 11.42%.
The historical rank and industry rank for Zoom Video Communications's Return-on-Tangible-Equity or its related term are showing as below:
ZM'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 1.76 Med: 10.78 Max: 28.8
Current: 2.35
During the past 7 years, Zoom Video Communications's highest Return-on-Tangible-Equity was 28.80%. The lowest was 1.76%. And the median was 10.78%.
ZM's Return-on-Tangible-Equity is ranked worse than 57.88% of 2410
companies
in the Software industry
Industry Median: 6.61
vs ZM: 2.35
Zoom Video Communications Return-on-Tangible-Equity Historical Data
The historical data trend for Zoom Video Communications's Return-on-Tangible-Equity 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.
Zoom Video Communications Annual Data
Trend
Jan17
Jan18
Jan19
Jan20
Jan21
Jan22
Jan23
Return-on-Tangible-Equity
10.78
5.07
28.80
28.76
1.76
Zoom Video Communications Quarterly Data
Oct18
Jan19
Apr19
Jul19
Oct19
Jan20
Apr20
Jul20
Oct20
Jan21
Apr21
Jul21
Oct21
Jan22
Apr22
Jul22
Oct22
Jan23
Apr23
Jul23
Return-on-Tangible-Equity
3.13
3.40
-7.17
1.02
11.42
Competitive Comparison
For the Software - Application subindustry, Zoom Video Communications's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity 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.
Zoom Video Communications Return-on-Tangible-Equity Distribution
For the Software industry and Technology sector, Zoom Video Communications's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Zoom Video Communications's Return-on-Tangible-Equity falls in comparison to its industry or sector. The grey bar indicates the Return-on-Tangible-Equity's extreme value range as defined by GuruFocus.
Zoom Video Communications Return-on-Tangible-Equity Calculation
Zoom Video Communications's annualized Return-on-Tangible-Equity for the fiscal year that ended in Jan. 2023 is calculated as
* 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 Return-on-Tangible-Equity, the net income 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 data used here is four times the quarterly (Jul. 2023) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
Zoom Video Communications (NAS:ZM) Return-on-Tangible-Equity Explanation
Return-on-Tangible-Equity 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). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income 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 Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity 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 Return-on-Tangible-Equitys can be extremely high.
Zoom Video Communications Return-on-Tangible-Equity Related Terms
Thank you for viewing the detailed overview of Zoom Video Communications's Return-on-Tangible-Equity provided by GuruFocus.com. Please click on the following links to see related term pages.
Zoom Video Communications (NAS:ZM) Business Description
Zoom Video Communications provides a communications platform that connects people through video, voice, chat, and content sharing. The company's cloud-native platform enables face-to-face video and connects users across various devices and locations in a single meeting. Zoom, which was founded in 2011 and is headquartered in San Jose, California, serves companies of all sizes from all industries around the world.
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