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Red VioletFRA:2KH -2.65%69 Return-on-Tangible-Equity is 30.57% as of Mar. 2026, which is 1647% above its 10-year median of 1.75. GuruFocus rates FRA:2KH with a GF Score™ of 69/100 and a GF Value™ of €34.53 (Significantly Overvalued). The stock has 4 warning signs investors should review. Among 2,480 Software companies, Red Violet ranks better than 72.74% 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. Red Violet's annualized net income for the quarter that ended in Mar. 2026 was €15.18 Mil. Red Violet's average shareholder tangible equity for the quarter that ended in Mar. 2026 was €49.67 Mil. Therefore, Red Violet's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 30.57%.
The historical rank and industry rank for Red Violet's Return-on-Tangible-Equity or its related term are showing as below:
FRA:2KH'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: -3319.49 Med: 1.75 Max: 33.53
Current: 25.57
During the past 10 years, Red Violet's highest Return-on-Tangible-Equity was 33.53%. The lowest was -3,319.49%. And the median was 1.75%.
FRA:2KH's Return-on-Tangible-Equity is ranked better than 72.74% of 2480
companies
in the Software industry
Industry Median: 8.845
vs FRA:2KH: 25.57
Red Violet (FRA:2KH) 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.
Red Violet Return-on-Tangible-Equity Related Terms
Red Violet Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Red Violet'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.
FRA:2KH vs GTM, MITK, IBTA: Return-on-Tangible-Equity Comparison
For the Software - Application subindustry, Red Violet'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.
Red Violet Return-on-Tangible-Equity vs Software Industry
For the Software industry and Technology sector, Red Violet's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Red Violet'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 30.57% mean?
Red Violet (FRA:2KH) has a Return-on-Tangible-Equity of 30.57% 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 Red Violet and its competitors. This is 1647% above median its historical median of 1.75. According to the industry distribution chart, Red Violet ranks #676 out of 2480 companies in the Software industry, placing it in the top 27.3%.
Is Red Violet's Return-on-Tangible-Equity too high?
Red Violet's current Return-on-Tangible-Equity of 30.57% is 1647% above median its 10-year median of 1.75. The Software industry median Return-on-Tangible-Equity is 8.85. Red Violet's value of 30.57% is 245.6% above this industry median. Based on the distribution chart, Red Violet ranks #676 out of 2480 companies in the Software industry, which is above the industry midpoint. Overall, Red Violet has a GF Score™ of 69/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Red Violet's Return-on-Tangible-Equity compare to GTM and MITK?
According to the Software industry distribution chart, Red Violet ranks #676 out of 2480 companies for Return-on-Tangible-Equity. This puts Red Violet in the upper half of its industry. The industry median Return-on-Tangible-Equity is 8.85. Red Violet's value of 30.57% is 245.6% above this benchmark. While the company's 10-year median is 1.75 vs. the industry median of 8.85, Red Violet 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 a Software company?
The median Return-on-Tangible-Equity among Software companies is 8.85, based on 2,480 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. Red Violet's current Return-on-Tangible-Equity of 30.57% is 245.6% 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 Red Violet and its competitors. For the Software industry, the median Return-on-Tangible-Equity is 8.85 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Red Violet's current Return-on-Tangible-Equity is 30.57%, which is 1647% above median its own 10-year median of 1.75. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Red Violet stock overvalued right now?
Based on GuruFocus' analysis, Red Violet (FRA:2KH) is currently considered Significantly Overvalued. The stock's GF Value™ is €34.53, compared to a current price of €57.00 — trading 65.1% above its estimated fair value. The current Return-on-Tangible-Equity is 30.57%, which is 1647% above median its 10-year median of 1.75 and 245.6% above the Software industry median of 8.85. Red Violet's overall GF Score™ is 69/100 with 4 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 Red Violet (FRA:2KH), the current Return-on-Tangible-Equity is 30.57% 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 Red Violet (FRA:2KH) Overvalued in 2026?
Based on GuruFocus' analysis, Red Violet stock appears to be overvalued.
The current stock price of €57.00 is trading 65.1% above its estimated GF Value™ of €34.53.
GuruFocus considers Red Violet to be Significantly Overvalued.
Key valuation signals for FRA:2KH:
Return-on-Tangible-Equity: 30.57% (1647% above median its 10-year median of 1.75)
GF Value™: €34.53 vs. price of €57.00 (65.1% above fair value)
Industry Position: 245.6% above the Software median (#676 of 2480)
No single metric tells the full story. See the FRA:2KH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Red Violet Inc builds proprietary technologies and applies analytical capabilities to deliver identity intelligence. The company's solutions enable the real-time identification and location of people, businesses, assets, and their interrelationships. These solutions are used for purposes including identity verification, risk mitigation, due diligence, fraud detection and prevention, regulatory compliance, and customer acquisition. Its cloud-native, AI-enabled identity intelligence platform, CORE, is purpose-built for the enterprise, yet flexible enough for organizations of all sizes, bringing clarity to massive datasets by transforming data into intelligence. The company generates substantially all of its revenue from licensing its solutions.
69GF Score
Get the complete analysis for FRA:2KH
Return-on-Tangible-Equity is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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