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. Allison Transmission Holdings's annualized net income for the quarter that ended in Mar. 2026 was $448 Mil. Allison Transmission Holdings's average shareholder tangible equity for the quarter that ended in Mar. 2026 was $-1,908 Mil. Therefore, Allison Transmission Holdings's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was Negative Tangible Equity%.
The historical rank and industry rank for Allison Transmission Holdings's Return-on-Tangible-Equity or its related term are showing as below:
ALSN'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 0 Med: 0 Max: 0
Current: Negative Tangible Equity
ALSN's Return-on-Tangible-Equity is ranked better than 99.92% of 1285
companies
in the Vehicles & Parts industry
Industry Median: 7.49
vs ALSN: Negative Tangible Equity
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.
Allison Transmission Holdings Return-on-Tangible-Equity Related Terms
Allison Transmission Holdings Return-on-Tangible-Equity Historical Data
* 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.
ALSN vs ALV, AUR, APTV: Return-on-Tangible-Equity Comparison
For the Auto Parts subindustry, Allison Transmission Holdings'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.
Allison Transmission Holdings Return-on-Tangible-Equity vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Allison Transmission Holdings's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Allison Transmission Holdings's Return-on-Tangible-Equity falls into.
* 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 (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of Negative Tangible Equity% mean?
Allison Transmission Holdings (ALSN) has a Return-on-Tangible-Equity of Negative Tangible Equity% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Allison Transmission Holdings and its competitors. According to the industry distribution chart, Allison Transmission Holdings ranks #1 out of 1285 companies in the Vehicles & Parts industry, placing it in the top 0.099999999999994%.
Is Allison Transmission Holdings' Return-on-Tangible-Equity too high?
Allison Transmission Holdings' current Return-on-Tangible-Equity is Negative Tangible Equity%. Based on the distribution chart, Allison Transmission Holdings ranks #1 out of 1285 companies in the Vehicles & Parts industry, which is in the top quartile — a strong position relative to peers. Overall, Allison Transmission Holdings has a GF Score™ of 95/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Allison Transmission Holdings' Return-on-Tangible-Equity compare to ALV and AUR?
According to the Vehicles & Parts industry distribution chart, Allison Transmission Holdings ranks #1 out of 1285 companies for Return-on-Tangible-Equity. This places Allison Transmission Holdings in the top 0% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 7.49. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Vehicles & Parts company?
The median Return-on-Tangible-Equity among Vehicles & Parts companies is 7.49, based on 1,285 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Allison Transmission Holdings and its competitors. For the Vehicles & Parts industry, the median Return-on-Tangible-Equity is 7.49 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Allison Transmission Holdings's current Return-on-Tangible-Equity is Negative Tangible Equity%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Allison Transmission Holdings stock overvalued right now?
Based on GuruFocus' analysis, Allison Transmission Holdings (ALSN) is currently considered Modestly Undervalued. The stock's GF Value™ is $125.66, compared to a current price of $112.74 — trading 10.3% below its estimated fair value. The current Return-on-Tangible-Equity is Negative Tangible Equity%. Allison Transmission Holdings' overall GF Score™ is 95/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For Allison Transmission Holdings (ALSN), the current Return-on-Tangible-Equity is Negative Tangible Equity% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Allison Transmission Holdings (ALSN) Overvalued in 2026?
Based on GuruFocus' analysis, Allison Transmission Holdings stock appears to be undervalued.
The current stock price of $112.74 is trading 10.3% below its estimated GF Value™ of $125.66.
GuruFocus considers Allison Transmission Holdings to be Modestly Undervalued.
No single metric tells the full story. See the ALSN stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Allison Transmission Holdings Business Description
Allison Transmission is the largest manufacturer of fully automatic transmissions for medium- and heavy-duty commercial vehicles. Its automatic transmissions allow customers to achieve better fuel and operator efficiency than less expensive manual and automated manual transmissions. Allison serves several end markets, including on- and off-highway equipment and military vehicles. Its on-highway business commands approximately 60% global market share. The company's transmissions can be found in Class 4-8 trucks, buses, and a limited number of large passenger vehicles (heavy-duty pickup trucks and motorhomes). Allison also produces commercial hybrid propulsion systems and is developing fully electric powertrains.
95GF Score
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