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. HSBC USA's annualized net income for the quarter that ended in Mar. 2016 was $616.00 Mil. HSBC USA's average shareholder tangible equity for the quarter that ended in Mar. 2016 was $18,988.50 Mil. Therefore, HSBC USA's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2016 was 3.24%.
The historical rank and industry rank for HSBC USA's Return-on-Tangible-Equity or its related term are showing as below:
HUSIPRHCL.PFD's Return-on-Tangible-Equity is not ranked *
in the Banks industry.
Industry Median: 11.23 * Ranked among companies with meaningful Return-on-Tangible-Equity only.
HSBC USA (NYSE:HUSIPRHCL.PFD) 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.
HSBC USA Return-on-Tangible-Equity Related Terms
HSBC USA Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for HSBC USA'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.
HUSIPRHCL.PFD vs GHDS, LFGP, NTB: Return-on-Tangible-Equity Comparison
For the Banks - Diversified subindustry, HSBC USA'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.
HSBC USA Return-on-Tangible-Equity vs Banks Industry
For the Banks industry and Financial Services sector, HSBC USA's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where HSBC USA'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. 2016) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 3.24% mean?
HSBC USA (HUSIPRHCL.PFD) has a Return-on-Tangible-Equity of 3.24% as of Mar. 2016. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on HSBC USA and its competitors.
Is HSBC USA's Return-on-Tangible-Equity too high?
HSBC USA's current Return-on-Tangible-Equity is 3.24%. The Banks industry median Return-on-Tangible-Equity is 11.23. HSBC USA's value of 3.24% is 71.1% below this industry median.
How does HSBC USA's Return-on-Tangible-Equity compare to GHDS and LFGP?
HSBC USA's Return-on-Tangible-Equity of 3.24% can be compared against companies in the Banks industry. The industry median Return-on-Tangible-Equity is 11.23. HSBC USA's value of 3.24% is 71.1% below this benchmark. 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 Banks company?
The median Return-on-Tangible-Equity among Banks companies is 11.23, based on 1,521 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. HSBC USA's current Return-on-Tangible-Equity of 3.24% is 71.1% below 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 HSBC USA and its competitors. For the Banks industry, the median Return-on-Tangible-Equity is 11.23 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. HSBC USA's current Return-on-Tangible-Equity is 3.24%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is HSBC USA stock overvalued right now?
HSBC USA (HUSIPRHCL.PFD) has a current Return-on-Tangible-Equity of 3.24%. The current Return-on-Tangible-Equity is 3.24% and 71.1% below the Banks industry median of 11.23. 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 HSBC USA (HUSIPRHCL.PFD), the current Return-on-Tangible-Equity is 3.24% as of Mar. 2016. 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.
HSBC USA Inc is a national banking association. The Company through HSBC Bank USA offers commercial and consumer banking products and related financial services. Its customers include individuals, small businesses, institutions and governments.
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