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Shopify (Shopify) Return-on-Tangible-Asset : -10.16% (As of Mar. 2024)


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What is Shopify Return-on-Tangible-Asset?

Return-on-Tangible-Asset is calculated as Net Income divided by its average total tangible assets. Total tangible assets equals to Total Assets minus Intangible Assets. Shopify's annualized Net Income for the quarter that ended in Mar. 2024 was $-1,092 Mil. Shopify's average total tangible assets for the quarter that ended in Mar. 2024 was $10,752 Mil. Therefore, Shopify's annualized Return-on-Tangible-Asset for the quarter that ended in Mar. 2024 was -10.16%.

The historical rank and industry rank for Shopify's Return-on-Tangible-Asset or its related term are showing as below:

SHOP' s Return-on-Tangible-Asset Range Over the Past 10 Years
Min: -32.37   Med: -4.99   Max: 28.91
Current: -2.11

During the past 12 years, Shopify's highest Return-on-Tangible-Asset was 28.91%. The lowest was -32.37%. And the median was -4.99%.

SHOP's Return-on-Tangible-Asset is ranked worse than
57.8% of 2822 companies
in the Software industry
Industry Median: 1.29 vs SHOP: -2.11

Shopify Return-on-Tangible-Asset Historical Data

The historical data trend for Shopify's Return-on-Tangible-Asset 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.

Shopify Return-on-Tangible-Asset Chart

Shopify Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Return-on-Tangible-Asset
Get a 7-Day Free Trial Premium Member Only Premium Member Only -4.80 6.19 28.91 -32.37 1.36

Shopify Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
Return-on-Tangible-Asset Get a 7-Day Free Trial 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 3.15 -58.34 29.83 25.21 -10.16

Competitive Comparison of Shopify's Return-on-Tangible-Asset

For the Software - Application subindustry, Shopify's Return-on-Tangible-Asset, along with its competitors' market caps and Return-on-Tangible-Asset 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.


Shopify's Return-on-Tangible-Asset Distribution in the Software Industry

For the Software industry and Technology sector, Shopify's Return-on-Tangible-Asset distribution charts can be found below:

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



Shopify Return-on-Tangible-Asset Calculation

Shopify's annualized Return-on-Tangible-Asset for the fiscal year that ended in Dec. 2023 is calculated as:

Return-on-Tangible-Asset=Net Income/( (Total Tangible Assets+Total Tangible Assets)/ count )
(A: Dec. 2023 )  (A: Dec. 2022 )(A: Dec. 2023 )
=Net Income/( (Total Assets - Intangible Assets+Total Assets - Intangible Assets)/ count )
(A: Dec. 2023 )  (A: Dec. 2022 )(A: Dec. 2023 )
=132/( (8531+10843)/ 2 )
=132/9687
=1.36 %

Shopify's annualized Return-on-Tangible-Asset for the quarter that ended in Mar. 2024 is calculated as:

Return-on-Tangible-Asset=Net Income/( (Total Tangible Assets+Total Tangible Assets)/ count )
(Q: Mar. 2024 )  (Q: Dec. 2023 )(Q: Mar. 2024 )
=Net Income/( (Total Assets - Intangible Assets+Total Assets - Intangible Assets)/ count )
(Q: Mar. 2024 )  (Q: Dec. 2023 )(Q: Mar. 2024 )
=-1092/( (10843+10660)/ 2 )
=-1092/10751.5
=-10.16 %

* 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-Asset, 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 (Mar. 2024) net income data.


Shopify  (NYSE:SHOP) Return-on-Tangible-Asset Explanation

Return-on-Tangible-Asset 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." Return-on-Tangible-Asset measures a firm's efficiency at generating profits from its tangible assets. It shows how well a company uses what it has to generate earnings. Return-on-Tangible-Assets can vary drastically across industries. Therefore, Return-on-Tangible-Asset should not be used to compare companies in different industries.


Be Aware

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


Shopify Return-on-Tangible-Asset Related Terms

Thank you for viewing the detailed overview of Shopify's Return-on-Tangible-Asset provided by GuruFocus.com. Please click on the following links to see related term pages.


Shopify (Shopify) Business Description

Industry
Address
151 O'Connor Street, Ground Floor, Ottawa, ON, CAN, K2P2L8
Shopify offers an e-commerce platform primarily to small and medium-size businesses. The firm has two segments. The subscription solutions segment allows Shopify merchants to conduct e-commerce on a variety of platforms, including the company's website, physical stores, pop-up stores, kiosks, social networks (Facebook), and Amazon. The merchant solutions segment offers add-on products for the platform that facilitate e-commerce and include Shopify Payments, Shopify Shipping, and Shopify Capital.

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