ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Zip Co's annualizedNet Income for the quarter that ended in Dec. 2025 was A$105 Mil.
Zip Co's average Total Assets over the quarter that ended in Dec. 2025 was A$3,741 Mil. Therefore, Zip Co's annualized ROA % for the quarter that ended in Dec. 2025 was 2.80%.
The historical rank and industry rank for Zip Co's ROA % or its related term are showing as below:
ASX:ZIP'
s ROA % Range Over the Past 10 Years
Min: -32.59 Med: -8.34 Max: 2.96
Current: 2.96
During the past 13 years, Zip Co's highest ROA % was 2.96%. The lowest was -32.59%. And the median was -8.34%.
ASX:ZIP's ROA % is ranked better than 64.77% of 545
companies
in the Credit Services industry
Industry Median: 1.92
vs ASX:ZIP: 2.96
Zip Co (ASX:ZIP) ROA % Explanation
ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A banks ROA % is typically well under 2%.
Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:
Note:
The Net Income data used here is two times the semi-annual (Dec. 2025) net income data. The Revenue data used here is two times the semi-annual (Dec. 2025) revenue data.
* 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.
Be Aware
Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).
Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.
E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.
Zip Co ROA % Related Terms
Zip Co ROA % Historical Data
* Premium members only.
The historical data trend for Zip Co's ROA % 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.
For the Credit Services subindustry, Zip Co's ROA %, along with its competitors' market caps and ROA % 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.
Zip Co ROA % vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Zip Co's ROA % distribution charts can be found below:
* The bar in red indicates where Zip Co's ROA % 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 ROA %, the net income of the last fiscal year and the average total assets 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.
ROA % is displayed in the 30-year financial page.
Zip Co (ASX:ZIP) has a ROA % of 2.80% as of Dec. 2025. Return on assets is the ratio of current-period net income to average two-period total assets. View historical data on Zip Co and its competitors. According to the industry distribution chart, Zip Co ranks #192 out of 545 companies in the Credit Services industry, placing it in the top 35.2%.
Is Zip Co's ROA % too high?
Zip Co's current ROA % is 2.80%. The Credit Services industry median ROA % is 1.92. Zip Co's value of 2.80% is 45.8% above this industry median. Based on the distribution chart, Zip Co ranks #192 out of 545 companies in the Credit Services industry, which is above the industry midpoint. Overall, Zip Co has a GF Score™ of 62/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Zip Co's ROA % compare to V and MA?
According to the Credit Services industry distribution chart, Zip Co ranks #192 out of 545 companies for ROA %. This puts Zip Co in the upper half of its industry. The industry median ROA % is 1.92. Zip Co's value of 2.80% is 45.8% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROA % for a Credit Services company?
The median ROA % among Credit Services companies is 1.92, based on 545 companies in the industry. Companies in the top quartile (top 25%) have a ROA % significantly above this median, while those in the bottom quartile fall well below. However, ROA % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Zip Co's current ROA % of 2.80% is 45.8% 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 ROA % mean?
A high ROA % can signal that a stock is expensive relative to its fundamentals. Return on assets is the ratio of current-period net income to average two-period total assets. View historical data on Zip Co and its competitors. For the Credit Services industry, the median ROA % is 1.92 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Zip Co's current ROA % is 2.80%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Zip Co stock overvalued right now?
Based on GuruFocus' analysis, Zip Co (ASX:ZIP) is currently considered Significantly Overvalued. The stock's GF Value™ is A$2.07, compared to a current price of A$3.24 — trading 56.5% above its estimated fair value. The current ROA % is 2.80% and 45.8% above the Credit Services industry median of 1.92. Zip Co's overall GF Score™ is 62/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROA % calculated?
ROA % is calculated from a company's financial statements. For Zip Co (ASX:ZIP), the current ROA % is 2.80% 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 Zip Co (ASX:ZIP) Overvalued in 2026?
Based on GuruFocus' analysis, Zip Co stock appears to be overvalued.
The current stock price of A$3.24 is trading 56.5% above its estimated GF Value™ of A$2.07.
GuruFocus considers Zip Co to be Significantly Overvalued.
Key valuation signals for ASX:ZIP:
ROA %: 2.80%
GF Value™: A$2.07 vs. price of A$3.24 (56.5% above fair value)
Industry Position: 45.8% above the Credit Services median (#192 of 545)
No single metric tells the full story. See the ASX:ZIP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Zip is a credit provider operating two segments: Australia and New Zealand, and the US. Founded in Australia in 2013, it has over 6 million active customers and partners with over 85,000 merchants. In Australia, Zip positions itself as a credit card alternative, with several revolving credit products. Customers can carry the balance over time with a monthly fee and set their own repayment schedule. The US and New Zealand offering is a far more vanilla BNPL offering: Pay-in-4 in New Zealand and Pay-in-Z in the US, where customers pay back in fixed instalments. The US segment is built on the 2020 acquisition of QuadPay and has recently become Zip's largest and fastest-growing segment.
62GF Score
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