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Dr. Charlie Tian is the founder and CEO of GuruFocus.com, a leading global investment research platform established in 2004. With a Ph.D. in physics, Dr. Tian transitioned from science to finance, applying a data-driven, disciplined approach to value investing.
SM Energy CoSM -0.28%73 Return-on-Tangible-Equity is -22.95% as of Mar. 2026. GuruFocus rates SM with a GF Score™ of 73/100 and a GF Value™ of $52.26 (Possible Value Trap). The stock has 10 warning signs investors should review. Among 943 Oil & Gas companies, SM Energy Co ranks worse than 61.72% 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. SM Energy Co's annualized net income for the quarter that ended in Mar. 2026 was $-1,340 Mil. SM Energy Co's average shareholder tangible equity for the quarter that ended in Mar. 2026 was $5,839 Mil. Therefore, SM Energy Co's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was -22.95%.
The historical rank and industry rank for SM Energy Co's Return-on-Tangible-Equity or its related term are showing as below:
SM'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: -34.84 Med: 8.06 Max: 43.19
Current: 2.57
During the past 13 years, SM Energy Co's highest Return-on-Tangible-Equity was 43.19%. The lowest was -34.84%. And the median was 8.06%.
SM's Return-on-Tangible-Equity is ranked worse than 61.72% of 943
companies
in the Oil & Gas industry
Industry Median: 6.73
vs SM: 2.57
SM Energy Co (NYSE:SM) 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.
SM Energy Co Return-on-Tangible-Equity Related Terms
SM Energy Co Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for SM Energy Co'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.
SM vs CHRD, RRC, MTDR: Return-on-Tangible-Equity Comparison
For the Oil & Gas E&P subindustry, SM Energy Co'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.
SM Energy Co Return-on-Tangible-Equity vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, SM Energy Co's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where SM Energy Co'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 -22.95% mean?
SM Energy Co (SM) has a Return-on-Tangible-Equity of -22.95% 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 SM Energy Co and its competitors. According to the industry distribution chart, SM Energy Co ranks #582 out of 943 companies in the Oil & Gas industry, placing it in the top 61.7%.
Is SM Energy Co's Return-on-Tangible-Equity too high?
SM Energy Co's current Return-on-Tangible-Equity is -22.95%. Based on the distribution chart, SM Energy Co ranks #582 out of 943 companies in the Oil & Gas industry, which is below the industry midpoint. Overall, SM Energy Co has a GF Score™ of 73/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does SM Energy Co's Return-on-Tangible-Equity compare to CHRD and RRC?
According to the Oil & Gas industry distribution chart, SM Energy Co ranks #582 out of 943 companies for Return-on-Tangible-Equity. This places SM Energy Co in the lower half of its industry. The industry median Return-on-Tangible-Equity is 6.73. 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 an Oil & Gas company?
The median Return-on-Tangible-Equity among Oil & Gas companies is 6.73, based on 943 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. 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 SM Energy Co and its competitors. For the Oil & Gas industry, the median Return-on-Tangible-Equity is 6.73 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. SM Energy Co's current Return-on-Tangible-Equity is -22.95%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is SM Energy Co stock overvalued right now?
Based on GuruFocus' analysis, SM Energy Co (SM) is currently considered Possible Value Trap. The stock's GF Value™ is $52.26, compared to a current price of $31.63 — trading 39.5% below its estimated fair value. The current Return-on-Tangible-Equity is -22.95%. SM Energy Co's overall GF Score™ is 73/100 with 10 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 SM Energy Co (SM), the current Return-on-Tangible-Equity is -22.95% 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 SM Energy Co (SM) Overvalued in 2026?
Based on GuruFocus' analysis, SM Energy Co stock appears to be undervalued.
The current stock price of $31.63 is trading 39.5% below its estimated GF Value™ of $52.26.
GuruFocus considers SM Energy Co to be Possible Value Trap.
Key valuation signals for SM:
Return-on-Tangible-Equity: -22.95%
GF Value™: $52.26 vs. price of $31.63 (39.5% below fair value)
No single metric tells the full story. See the SM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
SM Energy Co is an independent energy company engaged in the acquisition, exploration, development, and production of oil, gas, and NGLs in Texas and Utah. The Company operates in the oil and gas extraction industry, focused on exploration and production activities, onshore in the United States. Its portfolio is comprised of assets in the Midland Basin of West Texas, the Maverick Basin of South Texas, and the Uinta Basin of northeastern Utah.
73GF Score
Get the complete analysis for SM
Return-on-Tangible-Equity is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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