Formula Systems (1985)FRA:FSY +5.39%67 Return-on-Tangible-Equity is 25.50% as of Mar. 2026, which is 99% below its 10-year median of 2,603.96. GuruFocus rates FRA:FSY with a GF Score™ of 67/100 and a GF Value™ of €106.40 (Modestly Undervalued). The stock has 4 warning signs investors should review. Among 2,470 Software companies, Formula Systems (1985) ranks better than 99.92% 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. Formula Systems (1985)'s annualized net income for the quarter that ended in Mar. 2026 was €123 Mil. Formula Systems (1985)'s average shareholder tangible equity for the quarter that ended in Mar. 2026 was €484 Mil. Therefore, Formula Systems (1985)'s annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 25.50%.
The historical rank and industry rank for Formula Systems (1985)'s Return-on-Tangible-Equity or its related term are showing as below:
FRA:FSY'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 2603.96 Med: 2603.96 Max: 2603.96
Current: Negative Tangible Equity
During the past 13 years, Formula Systems (1985)'s highest Return-on-Tangible-Equity was 2,603.96%. The lowest was 2,603.96%. And the median was 2,603.96%.
FRA:FSY's Return-on-Tangible-Equity is ranked better than 99.92% of 2470
companies
in the Software industry
Industry Median: 8.77
vs FRA:FSY: Negative Tangible Equity
Formula Systems (1985) (FRA:FSY) 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.
Formula Systems (1985) Return-on-Tangible-Equity Related Terms
Formula Systems (1985) Return-on-Tangible-Equity Historical Data
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The historical data trend for Formula Systems (1985)'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.
Formula Systems (1985) Return-on-Tangible-Equity Chart
FRA:FSY vs IBM, ACN, FISV: Return-on-Tangible-Equity Comparison
For the Information Technology Services subindustry, Formula Systems (1985)'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.
Formula Systems (1985) Return-on-Tangible-Equity vs Software Industry
For the Software industry and Technology sector, Formula Systems (1985)'s Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Formula Systems (1985)'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 25.50% mean?
Formula Systems (1985) (FRA:FSY) has a Return-on-Tangible-Equity of 25.50% 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 Formula Systems (1985) and its competitors. This is 99% below median its historical median of 2,603.96. Over the past decade, Formula Systems (1985)'s Return-on-Tangible-Equity has ranged from 2,603.96 to 2,603.96. According to the industry distribution chart, Formula Systems (1985) ranks #2 out of 2470 companies in the Software industry, placing it in the top 0.099999999999994%.
Is Formula Systems (1985)'s Return-on-Tangible-Equity too high?
Formula Systems (1985)'s current Return-on-Tangible-Equity of 25.50% is 99% below median its 10-year median of 2,603.96. Over the past 10 years, this metric has ranged from a low of 2,603.96 to a high of 2,603.96. The Software industry median Return-on-Tangible-Equity is 8.77. Formula Systems (1985)'s value of 25.50% is 190.8% above this industry median. Based on the distribution chart, Formula Systems (1985) ranks #2 out of 2470 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Formula Systems (1985) has a GF Score™ of 67/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Formula Systems (1985)'s Return-on-Tangible-Equity compare to IBM and ACN?
According to the Software industry distribution chart, Formula Systems (1985) ranks #2 out of 2470 companies for Return-on-Tangible-Equity. This places Formula Systems (1985) in the top 0% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 8.77. Formula Systems (1985)'s value of 25.50% is 190.8% above this benchmark. Historically, Formula Systems (1985)'s own Return-on-Tangible-Equity has ranged from 2,603.96 to 2,603.96 over the past decade. While the company's 10-year median is 2,603.96 vs. the industry median of 8.77, Formula Systems (1985) 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 8.77, based on 2,470 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. Formula Systems (1985)'s current Return-on-Tangible-Equity of 25.50% is 190.8% 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 Formula Systems (1985) and its competitors. For the Software industry, the median Return-on-Tangible-Equity is 8.77 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Formula Systems (1985)'s current Return-on-Tangible-Equity is 25.50%, which is 99% below median its own 10-year median of 2,603.96. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Formula Systems (1985) stock overvalued right now?
Based on GuruFocus' analysis, Formula Systems (1985) (FRA:FSY) is currently considered Modestly Undervalued. The stock's GF Value™ is €106.40, compared to a current price of €88.00 — trading 17.3% below its estimated fair value. The current Return-on-Tangible-Equity is 25.50%, which is 99% below median its 10-year median of 2,603.96 and 190.8% above the Software industry median of 8.77. Formula Systems (1985)'s overall GF Score™ is 67/100 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 Formula Systems (1985) (FRA:FSY), the current Return-on-Tangible-Equity is 25.50% 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 Formula Systems (1985) (FRA:FSY) Overvalued in 2026?
Based on GuruFocus' analysis, Formula Systems (1985) stock appears to be undervalued.
The current stock price of €88.00 is trading 17.3% below its estimated GF Value™ of €106.40.
GuruFocus considers Formula Systems (1985) to be Modestly Undervalued.
Key valuation signals for FRA:FSY:
Return-on-Tangible-Equity: 25.50% (99% below median its 10-year median of 2,603.96)
GF Value™: €106.40 vs. price of €88.00 (17.3% below fair value)
Industry Position: 190.8% above the Software median (#2 of 2470)
No single metric tells the full story. See the FRA:FSY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Formula Systems (1985) Ltd is an information technology company that is principally engaged through its directly and indirectly held investees in providing software consulting services, selling and marketing computer-based business solutions and hardware products from a wide range of domestic and international manufacturers, as well as developing proprietary software solutions. It delivers solutions in Israel and in numerous countries to customers with complex IT services needs. It designs and implements IT solutions and software systems that improve the productivity of customers' existing IT assets, enable them to effectively manage their operations and reduce their business risks in the face of changing business environments.
67GF Score
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