MichelinMEX:ML 84 Return-on-Tangible-Equity is 12.35% as of Dec. 2025, which is 30% below its 10-year median of 17.69. GuruFocus rates MEX:ML with a GF Score™ of 84/100 and a GF Value™ of MXN654.13. The stock has 6 warning signs investors should review. Among 1,285 Vehicles & Parts companies, Michelin ranks better than 66.85% 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. Michelin's annualized net income for the quarter that ended in Dec. 2025 was MXN35,042 Mil. Michelin's average shareholder tangible equity for the quarter that ended in Dec. 2025 was MXN283,675 Mil. Therefore, Michelin's annualized Return-on-Tangible-Equity for the quarter that ended in Dec. 2025 was 12.35%.
The historical rank and industry rank for Michelin's Return-on-Tangible-Equity or its related term are showing as below:
MEX:ML'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 7.4 Med: 17.69 Max: 21.43
Current: 12.43
During the past 13 years, Michelin's highest Return-on-Tangible-Equity was 21.43%. The lowest was 7.40%. And the median was 17.69%.
MEX:ML's Return-on-Tangible-Equity is ranked better than 66.85% of 1285
companies
in the Vehicles & Parts industry
Industry Median: 7.49
vs MEX:ML: 12.43
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.
Michelin Return-on-Tangible-Equity Related Terms
Michelin Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Michelin'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.
MEX:ML vs ORLY, AZO: Return-on-Tangible-Equity Comparison
For the Auto Parts subindustry, Michelin'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.
Michelin Return-on-Tangible-Equity vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Michelin's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Michelin'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 two times the semi-annual (Dec. 2025) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 12.35% mean?
Michelin (MEX:ML) has a Return-on-Tangible-Equity of 12.35% as of Dec. 2025. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Michelin and its competitors. This is 30% below median its historical median of 17.69. Over the past decade, Michelin's Return-on-Tangible-Equity has ranged from 7.40 to 21.43. According to the industry distribution chart, Michelin ranks #426 out of 1285 companies in the Vehicles & Parts industry, placing it in the top 33.2%.
Is Michelin's Return-on-Tangible-Equity too high?
Michelin's current Return-on-Tangible-Equity of 12.35% is 30% below median its 10-year median of 17.69. Over the past 10 years, this metric has ranged from a low of 7.40 to a high of 21.43. The Vehicles & Parts industry median Return-on-Tangible-Equity is 7.49. Michelin's value of 12.35% is 64.9% above this industry median. Based on the distribution chart, Michelin ranks #426 out of 1285 companies in the Vehicles & Parts industry, which is above the industry midpoint. Overall, Michelin has a GF Score™ of 84/100, reflecting its overall financial health beyond just this single metric.
How does Michelin's Return-on-Tangible-Equity compare to ORLY and AZO?
According to the Vehicles & Parts industry distribution chart, Michelin ranks #426 out of 1285 companies for Return-on-Tangible-Equity. This puts Michelin in the upper half of its industry. The industry median Return-on-Tangible-Equity is 7.49. Michelin's value of 12.35% is 64.9% above this benchmark. Historically, Michelin's own Return-on-Tangible-Equity has ranged from 7.40 to 21.43 over the past decade. While the company's 10-year median is 17.69 vs. the industry median of 7.49, Michelin 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 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. Michelin's current Return-on-Tangible-Equity of 12.35% is 64.9% 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 Michelin 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. Michelin's current Return-on-Tangible-Equity is 12.35%, which is 30% below median its own 10-year median of 17.69. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Michelin stock overvalued right now?
Michelin (MEX:ML) has a current Return-on-Tangible-Equity of 12.35%. The stock's GF Value™ is MXN654.13, compared to a current price of MXN733.29 — trading 12.1% above its estimated fair value. The current Return-on-Tangible-Equity is 12.35%, which is 30% below median its 10-year median of 17.69 and 64.9% above the Vehicles & Parts industry median of 7.49. Michelin's overall GF Score™ is 84/100 with 6 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 Michelin (MEX:ML), the current Return-on-Tangible-Equity is 12.35% as of Dec. 2025. 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 Michelin (MEX:ML) Overvalued in 2026?
Based on GuruFocus' analysis, Michelin stock appears to be overvalued.
The current stock price of MXN733.29 is trading 12.1% above its estimated GF Value™ of MXN654.13.
Key valuation signals for MEX:ML:
Return-on-Tangible-Equity: 12.35% (30% below median its 10-year median of 17.69)
GF Value™: MXN654.13 vs. price of MXN733.29 (12.1% above fair value)
Industry Position: 64.9% above the Vehicles & Parts median (#426 of 1285)
No single metric tells the full story. See the MEX:ML stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Michelin manufactures tires for passenger vehicles. The company also makes tires for all types of commercial vehicles as well as bicycle, motorcycle, earthmover, aviation, and agricultural tires. Its operations are organized into three operating segments namely Automotive and two-wheel; Road transportation; and Specialty businesses. The company generates maximum revenue from Automotive segments. The Specialty businesses include the Mining, Beyond-road, Two-wheel and Aircraft tire activities, as well as the High-Tech Materials activities. The Services & Solutions businesses are included for the majority part in the Road transportation and related distribution segment.
84GF Score
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