Leonardo DRSDRS +2.46%80 Return-on-Tangible-Equity is 17.68% as of Mar. 2026, which is 42% below its 10-year median of 30.58. GuruFocus rates DRS with a GF Score™ of 80/100 and a GF Value™ of $35.54 (Modestly Overvalued). The stock has 1 warning sign investors should review. Among 334 Aerospace & Defense companies, Leonardo DRS ranks better than 73.35% on this metric.
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. Leonardo DRS's annualized net income for the quarter that ended in Mar. 2026 was $248 Mil. Leonardo DRS's average shareholder tangible equity for the quarter that ended in Mar. 2026 was $1,403 Mil. Therefore, Leonardo DRS's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 17.68%.
The historical rank and industry rank for Leonardo DRS's Return-on-Tangible-Equity or its related term are showing as below:
DRS'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 20.07 Med: 30.58 Max: 83.74
Current: 22.13
During the past 8 years, Leonardo DRS's highest Return-on-Tangible-Equity was 83.74%. The lowest was 20.07%. And the median was 30.58%.
DRS's Return-on-Tangible-Equity is ranked better than 73.35% of 334
companies
in the Aerospace & Defense industry
Industry Median: 8.195
vs DRS: 22.13
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.
Leonardo DRS Return-on-Tangible-Equity Related Terms
Leonardo DRS Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Leonardo DRS'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.
DRS vs HII, PL, SARO: Return-on-Tangible-Equity Comparison
For the Aerospace & Defense subindustry, Leonardo DRS'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.
Leonardo DRS Return-on-Tangible-Equity vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, Leonardo DRS's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Leonardo DRS'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 17.68% mean?
Leonardo DRS (DRS) has a Return-on-Tangible-Equity of 17.68% 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 Leonardo DRS and its competitors. This is 42% below median its historical median of 30.58. Over the past decade, Leonardo DRS's Return-on-Tangible-Equity has ranged from 20.07 to 83.74. According to the industry distribution chart, Leonardo DRS ranks #89 out of 334 companies in the Aerospace & Defense industry, placing it in the top 26.6%.
Is Leonardo DRS's Return-on-Tangible-Equity too high?
Leonardo DRS's current Return-on-Tangible-Equity of 17.68% is 42% below median its 10-year median of 30.58. Over the past 10 years, this metric has ranged from a low of 20.07 to a high of 83.74. The Aerospace & Defense industry median Return-on-Tangible-Equity is 8.20. Leonardo DRS's value of 17.68% is 115.7% above this industry median. Based on the distribution chart, Leonardo DRS ranks #89 out of 334 companies in the Aerospace & Defense industry, which is above the industry midpoint. Overall, Leonardo DRS has a GF Score™ of 80/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Leonardo DRS's Return-on-Tangible-Equity compare to HII and PL?
According to the Aerospace & Defense industry distribution chart, Leonardo DRS ranks #89 out of 334 companies for Return-on-Tangible-Equity. This puts Leonardo DRS in the upper half of its industry. The industry median Return-on-Tangible-Equity is 8.20. Leonardo DRS's value of 17.68% is 115.7% above this benchmark. Historically, Leonardo DRS's own Return-on-Tangible-Equity has ranged from 20.07 to 83.74 over the past decade. While the company's 10-year median is 30.58 vs. the industry median of 8.20, Leonardo DRS has consistently been above the industry average. 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 an Aerospace & Defense company?
The median Return-on-Tangible-Equity among Aerospace & Defense companies is 8.20, based on 334 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. Leonardo DRS's current Return-on-Tangible-Equity of 17.68% is 115.7% above the industry median. 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 Leonardo DRS and its competitors. For the Aerospace & Defense industry, the median Return-on-Tangible-Equity is 8.20 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Leonardo DRS's current Return-on-Tangible-Equity is 17.68%, which is 42% below median its own 10-year median of 30.58. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Leonardo DRS stock overvalued right now?
Based on GuruFocus' analysis, Leonardo DRS (DRS) is currently considered Modestly Overvalued. The stock's GF Value™ is $35.54, compared to a current price of $43.72 — trading 23% above its estimated fair value. The current Return-on-Tangible-Equity is 17.68%, which is 42% below median its 10-year median of 30.58 and 115.7% above the Aerospace & Defense industry median of 8.20. Leonardo DRS's overall GF Score™ is 80/100 with 1 warning sign 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 Leonardo DRS (DRS), the current Return-on-Tangible-Equity is 17.68% 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 Leonardo DRS (DRS) Overvalued in 2026?
Based on GuruFocus' analysis, Leonardo DRS stock appears to be overvalued.
The current stock price of $43.72 is trading 23% above its estimated GF Value™ of $35.54.
GuruFocus considers Leonardo DRS to be Modestly Overvalued.
Key valuation signals for DRS:
Return-on-Tangible-Equity: 17.68% (42% below median its 10-year median of 30.58)
GF Value™: $35.54 vs. price of $43.72 (23% above fair value)
Industry Position: 115.7% above the Aerospace & Defense median (#89 of 334)
No single metric tells the full story. See the DRS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Leonardo DRS Inc is a provider of defense products and technologies that are used across land, air, sea, space, and cyber domains. It is in the design, development, and manufacture of Advanced sensing, network computing, force protection, and electric power and propulsion technologies and solutions. The company has two segments: Advanced Sensing and Computing, which generates the majority of revenue, and the Integrated Mission Systems segment. The Advanced Sensing and Computing segment is engaged in designing, developing, and manufacturing sensing and network computing technology that enables real-time situational awareness required for enhanced operational decision-making and execution by the customers.
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