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Observit ABOSTO:OBSE +4.76%33 Return-on-Tangible-Equity is 6.02% as of Mar. 2026, which is 100% below its 10-year median of 1,220.49. GuruFocus rates OSTO:OBSE with a GF Score™ of 33/100 and a GF Value™ of kr0.40 (Significantly Overvalued). The stock has 6 warning signs investors should review. Among 2,483 Software companies, Observit AB ranks better than 50.46% 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. Observit AB's annualized net income for the quarter that ended in Mar. 2026 was kr1.34 Mil. Observit AB's average shareholder tangible equity for the quarter that ended in Mar. 2026 was kr22.20 Mil. Therefore, Observit AB's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 6.02%.
The historical rank and industry rank for Observit AB's Return-on-Tangible-Equity or its related term are showing as below:
OSTO:OBSE'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 10.05 Med: 1220.49 Max: 2428.47
Current: 10.05
During the past 5 years, Observit AB's highest Return-on-Tangible-Equity was 2,428.47%. The lowest was 10.05%. And the median was 1,220.49%.
OSTO:OBSE's Return-on-Tangible-Equity is ranked better than 50.46% of 2483
companies
in the Software industry
Industry Median: 9.65
vs OSTO:OBSE: 10.05
Observit AB (OSTO:OBSE) 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.
Observit AB Return-on-Tangible-Equity Related Terms
Observit AB Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Observit AB'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.
OSTO:OBSE vs IBM, ACN, FISV: Return-on-Tangible-Equity Comparison
For the Information Technology Services subindustry, Observit AB'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.
Observit AB Return-on-Tangible-Equity vs Software Industry
For the Software industry and Technology sector, Observit AB's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Observit AB'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 6.02% mean?
Observit AB (OSTO:OBSE) has a Return-on-Tangible-Equity of 6.02% 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 Observit AB and its competitors. This is 100% below median its historical median of 1,220.49. Over the past decade, Observit AB's Return-on-Tangible-Equity has ranged from 10.05 to 2,428.47. According to the industry distribution chart, Observit AB ranks #1230 out of 2483 companies in the Software industry, placing it in the top 49.5%.
Is Observit AB's Return-on-Tangible-Equity too high?
Observit AB's current Return-on-Tangible-Equity of 6.02% is 100% below median its 10-year median of 1,220.49. Over the past 10 years, this metric has ranged from a low of 10.05 to a high of 2,428.47. The Software industry median Return-on-Tangible-Equity is 9.65. Observit AB's value of 6.02% is 37.6% below this industry median. Based on the distribution chart, Observit AB ranks #1230 out of 2483 companies in the Software industry, which is above the industry midpoint. Overall, Observit AB has a GF Score™ of 33/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Observit AB's Return-on-Tangible-Equity compare to IBM and ACN?
According to the Software industry distribution chart, Observit AB ranks #1230 out of 2483 companies for Return-on-Tangible-Equity. This puts Observit AB in the upper half of its industry. The industry median Return-on-Tangible-Equity is 9.65. Observit AB's value of 6.02% is 37.6% below this benchmark. Historically, Observit AB's own Return-on-Tangible-Equity has ranged from 10.05 to 2,428.47 over the past decade. While the company's 10-year median is 1,220.49 vs. the industry median of 9.65, Observit AB has consistently been below 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 9.65, based on 2,483 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. Observit AB's current Return-on-Tangible-Equity of 6.02% is 37.6% 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 Observit AB and its competitors. For the Software industry, the median Return-on-Tangible-Equity is 9.65 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Observit AB's current Return-on-Tangible-Equity is 6.02%, which is 100% below median its own 10-year median of 1,220.49. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Observit AB stock overvalued right now?
Based on GuruFocus' analysis, Observit AB (OSTO:OBSE) is currently considered Significantly Overvalued. The stock's GF Value™ is kr0.40, compared to a current price of kr0.66 — trading 65% above its estimated fair value. The current Return-on-Tangible-Equity is 6.02%, which is 100% below median its 10-year median of 1,220.49 and 37.6% below the Software industry median of 9.65. Observit AB's overall GF Score™ is 33/100 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 Observit AB (OSTO:OBSE), the current Return-on-Tangible-Equity is 6.02% 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 Observit AB (OSTO:OBSE) Overvalued in 2026?
Based on GuruFocus' analysis, Observit AB stock appears to be overvalued.
The current stock price of kr0.66 is trading 65% above its estimated GF Value™ of kr0.40.
GuruFocus considers Observit AB to be Significantly Overvalued.
Key valuation signals for OSTO:OBSE:
Return-on-Tangible-Equity: 6.02% (100% below median its 10-year median of 1,220.49)
GF Value™: kr0.40 vs. price of kr0.66 (65% above fair value)
Industry Position: 37.6% below the Software median (#1230 of 2483)
No single metric tells the full story. See the OSTO:OBSE stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Observit AB is the market leader in the Nordics when it comes to mobile video surveillance in public transport. The company provides software as a cloud service, and a Software as a Service (SaaS) solution, and currently has approximately 38,000 licenses (one license per security camera) connected globally. The customer base includes bus operators such as Nobina, Keolis, and Arriva and other transport-heavy customers such as Elis. Observit wants to become the brand for mobile video solutions in the transport sector.
33GF Score
Get the complete analysis for OSTO:OBSE
Return-on-Tangible-Equity is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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