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Afterpay (Afterpay) Return-on-Tangible-Equity : -12.03% (As of Jun. 2021)


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What is Afterpay Return-on-Tangible-Equity?

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. Afterpay's annualized net income for the quarter that ended in Jun. 2021 was $-122.0 Mil. Afterpay's average shareholder tangible equity for the quarter that ended in Jun. 2021 was $1,014.3 Mil. Therefore, Afterpay's annualized Return-on-Tangible-Equity for the quarter that ended in Jun. 2021 was -12.03%.

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

AFTPY' s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: -16.34   Med: -10.53   Max: -2.84
Current: -13.34

During the past 5 years, Afterpay's highest Return-on-Tangible-Equity was -2.84%. The lowest was -16.34%. And the median was -10.53%.

AFTPY's Return-on-Tangible-Equity is not ranked
in the Software industry.
Industry Median: 7.96 vs AFTPY: -13.34

Afterpay Return-on-Tangible-Equity Historical Data

The historical data trend for Afterpay'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.

Afterpay Return-on-Tangible-Equity Chart

Afterpay Annual Data
Trend Jun17 Jun18 Jun19 Jun20 Jun21
Return-on-Tangible-Equity
-10.53 -8.83 -12.67 -2.83 -17.07

Afterpay Semi-Annual Data
Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21
Return-on-Tangible-Equity Get a 7-Day Free Trial Premium Member Only -10.10 -8.88 2.32 -12.92 -12.03

Competitive Comparison of Afterpay's Return-on-Tangible-Equity

For the Software - Infrastructure subindustry, Afterpay'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.


Afterpay's Return-on-Tangible-Equity Distribution in the Software Industry

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

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



Afterpay Return-on-Tangible-Equity Calculation

Afterpay's annualized Return-on-Tangible-Equity for the fiscal year that ended in Jun. 2021 is calculated as

Return-on-Tangible-Equity=Net Income/( (Total Tangible Equity+Total Tangible Equity)/ count )
(A: Jun. 2021 )  (A: Jun. 2020 )(A: Jun. 2021 )
=Net Income/( (Total Stockholders Equity - Intangible Assets+Total Stockholders Equity - Intangible Assets )/ count )
(A: Jun. 2021 )  (A: Jun. 2020 )(A: Jun. 2021 )
=-119.494/( (577.698+822.308 )/ 2 )
=-119.494/700.003
=-17.07 %

Afterpay's annualized Return-on-Tangible-Equity for the quarter that ended in Jun. 2021 is calculated as

Return-on-Tangible-Equity=Net Income/( (Total Tangible Equity+Total Tangible Equity)/ count )
(Q: Jun. 2021 )  (Q: Dec. 2020 )(Q: Jun. 2021 )
=Net Income/( (Total Stockholders Equity - Intangible Assets+Total Stockholders Equity - Intangible Assets)/ count )
(Q: Jun. 2021 )  (Q: Dec. 2020 )(Q: Jun. 2021 )
=-122.028/( (1206.205+822.308)/ 2 )
=-122.028/1014.2565
=-12.03 %

* 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 two times the semi-annual (Jun. 2021) net income data. Return-on-Tangible-Equity is displayed in the 10-year financial page.


Afterpay  (OTCPK:AFTPY) 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.


Afterpay Return-on-Tangible-Equity Related Terms

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


Afterpay (Afterpay) Business Description

Industry
Traded in Other Exchanges
N/A
Address
406 Collins Street, Level 5, Melbourne, VIC, AUS, 3000
Afterpay started its buy now, pay later, or BNPL, financing product in calendar 2015, listed on the ASX in May 2016 and merged with Touchcorp (who designed and built Afterpay's platform software) in June 2017. Its BNPL platform allows consumers to make acquisitions at merchant partners by paying instalments every two weeks. If consumers pay on time, they transact on Afterpay for free. Afterpay primarily generates revenue from receiving a margin from the merchant. Afterpay pays the merchant the full purchase price immediately on the sale, less this margin. The margin compensates Afterpay for accepting all non-payment risk, including credit risk and fraud by the consumer, and for encouraging consumers to purchase greater dollar values and transact more frequently.