Penguin SolutionsPENG -3.32%71 ROA % is 8.95% as of Feb. 2026, which is 1093% above its 10-year median of 0.75. GuruFocus rates PENG with a GF Score™ of 71/100 and a GF Value™ of $23.82 (Significantly Overvalued). The stock has 5 warning signs investors should review. Among 2,883 Software companies, Penguin Solutions ranks better than 57.44% on this metric.
ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Penguin Solutions's annualizedNet Income for the quarter that ended in Feb. 2026 was $150 Mil.
Penguin Solutions's average Total Assets over the quarter that ended in Feb. 2026 was $1,674 Mil. Therefore, Penguin Solutions's annualized ROA % for the quarter that ended in Feb. 2026 was 8.95%.
The historical rank and industry rank for Penguin Solutions's ROA % or its related term are showing as below:
PENG'
s ROA % Range Over the Past 10 Years
Min: -12.18 Med: 0.75 Max: 20.73
Current: 3.19
During the past 11 years, Penguin Solutions's highest ROA % was 20.73%. The lowest was -12.18%. And the median was 0.75%.
PENG's ROA % is ranked better than 57.44% of 2883
companies
in the Software industry
Industry Median: 1.68
vs PENG: 3.19
Penguin Solutions (NAS:PENG) 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 four times the quarterly (Feb. 2026) net income data. The Revenue data used here is four times the quarterly (Feb. 2026) 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.
Penguin Solutions ROA % Related Terms
Penguin Solutions ROA % Historical Data
* Premium members only.
The historical data trend for Penguin Solutions'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 Information Technology Services subindustry, Penguin Solutions'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.
Penguin Solutions ROA % vs Software Industry
For the Software industry and Technology sector, Penguin Solutions's ROA % distribution charts can be found below:
* The bar in red indicates where Penguin Solutions'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 four times the quarterly (Feb. 2026) net income data.
ROA % is displayed in the 30-year financial page.
Penguin Solutions (PENG) has a ROA % of 8.95% as of Feb. 2026. Return on assets is the ratio of current-period net income to average two-period total assets. View historical data on Penguin Solutions and its competitors. This is 1093% above median its historical median of 0.75. According to the industry distribution chart, Penguin Solutions ranks #1227 out of 2883 companies in the Software industry, placing it in the top 42.6%.
Is Penguin Solutions' ROA % too high?
Penguin Solutions' current ROA % of 8.95% is 1093% above median its 10-year median of 0.75. The Software industry median ROA % is 1.68. Penguin Solutions' value of 8.95% is 432.7% above this industry median. Based on the distribution chart, Penguin Solutions ranks #1227 out of 2883 companies in the Software industry, which is above the industry midpoint. Overall, Penguin Solutions has a GF Score™ of 71/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Penguin Solutions' ROA % compare to VNET and KD?
According to the Software industry distribution chart, Penguin Solutions ranks #1227 out of 2883 companies for ROA %. This puts Penguin Solutions in the upper half of its industry. The industry median ROA % is 1.68. Penguin Solutions' value of 8.95% is 432.7% above this benchmark. While the company's 10-year median is 0.75 vs. the industry median of 1.68, Penguin Solutions 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 ROA % for a Software company?
The median ROA % among Software companies is 1.68, based on 2,883 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. Penguin Solutions's current ROA % of 8.95% is 432.7% 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 Penguin Solutions and its competitors. For the Software industry, the median ROA % is 1.68 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Penguin Solutions's current ROA % is 8.95%, which is 1093% above median its own 10-year median of 0.75. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Penguin Solutions stock overvalued right now?
Based on GuruFocus' analysis, Penguin Solutions (PENG) is currently considered Significantly Overvalued. The stock's GF Value™ is $23.82, compared to a current price of $64.72 — trading 171.7% above its estimated fair value. The current ROA % is 8.95%, which is 1093% above median its 10-year median of 0.75 and 432.7% above the Software industry median of 1.68. Penguin Solutions' overall GF Score™ is 71/100 with 5 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 Penguin Solutions (PENG), the current ROA % is 8.95% as of Feb. 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 Penguin Solutions (PENG) Overvalued in 2026?
Based on GuruFocus' analysis, Penguin Solutions stock appears to be overvalued.
The current stock price of $64.72 is trading 171.7% above its estimated GF Value™ of $23.82.
GuruFocus considers Penguin Solutions to be Significantly Overvalued.
Key valuation signals for PENG:
ROA %: 8.95% (1093% above median its 10-year median of 0.75)
GF Value™: $23.82 vs. price of $64.72 (171.7% above fair value)
Industry Position: 432.7% above the Software median (#1227 of 2883)
No single metric tells the full story. See the PENG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Penguin Solutions Inc is an end-to-end technology company engaged in Intelligent Platform Solutions, Integrated Memory, and Optimized LED business. Its product include Servers, software, OCP HPC & AI system, Racks and Edge. Servers include AMD-based Serves, Intel-based Servers, etc. Software products include Scyld ClusterWare, Scyld Cloud Central, etc. OCP HPC & AI Systems includes OCP Servers & Storage and etc.
71GF Score
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