The a2 Milk CoASX:A2M +1.03%83 ROE % is 1.49% as of Dec. 2025, which is 94% below its 10-year median of 23.59. GuruFocus rates ASX:A2M with a GF Score™ of 83/100 and a GF Value™ of A$6.68 (Fairly Valued). The stock has 3 warning signs investors should review. Among 1,915 Consumer Packaged Goods companies, The a2 Milk Co ranks better than 58.54% on this metric.
ROE % is calculated as Net Income divided by its average Total Stockholders Equity over a certain period of time. The a2 Milk Co's annualized net income for the quarter that ended in Dec. 2025 was A$19 Mil. The a2 Milk Co's average Total Stockholders Equity over the quarter that ended in Dec. 2025 was A$1,276 Mil. Therefore, The a2 Milk Co's annualized ROE % for the quarter that ended in Dec. 2025 was 1.49%.
The historical rank and industry rank for The a2 Milk Co's ROE % or its related term are showing as below:
ASX:A2M'
s ROE % Range Over the Past 10 Years
Min: 7.25 Med: 23.59 Max: 48.61
Current: 8.89
During the past 13 years, The a2 Milk Co's highest ROE % was 48.61%. The lowest was 7.25%. And the median was 23.59%.
ASX:A2M's ROE % is ranked better than 58.54% of 1915
companies
in the Consumer Packaged Goods industry
Industry Median: 6.75
vs ASX:A2M: 8.89
The a2 Milk Co (ASX:A2M) ROE % Explanation
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
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. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* 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
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % 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 ROE %s can be extremely high.
The a2 Milk Co ROE % Related Terms
The a2 Milk Co ROE % Historical Data
* Premium members only.
The historical data trend for The a2 Milk Co's ROE % 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 Packaged Foods subindustry, The a2 Milk Co's ROE %, along with its competitors' market caps and ROE % 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.
The a2 Milk Co ROE % vs Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, The a2 Milk Co's ROE % distribution charts can be found below:
* The bar in red indicates where The a2 Milk Co's ROE % 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 ROE %, the net income of the last fiscal year and the average total shareholder 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.
ROE % is displayed in the 30-year financial page.
The a2 Milk Co (ASX:A2M) has a ROE % of 1.49% as of Dec. 2025. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on The a2 Milk Co and its competitors. This is 94% below median its historical median of 23.59. Over the past decade, The a2 Milk Co's ROE % has ranged from 7.25 to 48.61. According to the industry distribution chart, The a2 Milk Co ranks #794 out of 1915 companies in the Consumer Packaged Goods industry, placing it in the top 41.5%.
Is The a2 Milk Co's ROE % too high?
The a2 Milk Co's current ROE % of 1.49% is 94% below median its 10-year median of 23.59. Over the past 10 years, this metric has ranged from a low of 7.25 to a high of 48.61. The Consumer Packaged Goods industry median ROE % is 6.75. The a2 Milk Co's value of 1.49% is 77.9% below this industry median. Based on the distribution chart, The a2 Milk Co ranks #794 out of 1915 companies in the Consumer Packaged Goods industry, which is above the industry midpoint. Overall, The a2 Milk Co has a GF Score™ of 83/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does The a2 Milk Co's ROE % compare to KHC and GIS?
According to the Consumer Packaged Goods industry distribution chart, The a2 Milk Co ranks #794 out of 1915 companies for ROE %. This puts The a2 Milk Co in the upper half of its industry. The industry median ROE % is 6.75. The a2 Milk Co's value of 1.49% is 77.9% below this benchmark. Historically, The a2 Milk Co's own ROE % has ranged from 7.25 to 48.61 over the past decade. While the company's 10-year median is 23.59 vs. the industry median of 6.75, The a2 Milk Co 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 ROE % for a Consumer Packaged Goods company?
The median ROE % among Consumer Packaged Goods companies is 6.75, based on 1,915 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. The a2 Milk Co's current ROE % of 1.49% is 77.9% 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 ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on The a2 Milk Co and its competitors. For the Consumer Packaged Goods industry, the median ROE % is 6.75 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. The a2 Milk Co's current ROE % is 1.49%, which is 94% below median its own 10-year median of 23.59. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is The a2 Milk Co stock overvalued right now?
Based on GuruFocus' analysis, The a2 Milk Co (ASX:A2M) is currently considered Fairly Valued. The stock's GF Value™ is A$6.68, compared to a current price of A$6.85 — trading 2.5% above its estimated fair value. The current ROE % is 1.49%, which is 94% below median its 10-year median of 23.59 and 77.9% below the Consumer Packaged Goods industry median of 6.75. The a2 Milk Co's overall GF Score™ is 83/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For The a2 Milk Co (ASX:A2M), the current ROE % is 1.49% 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 The a2 Milk Co (ASX:A2M) Overvalued in 2026?
Based on GuruFocus' analysis, The a2 Milk Co stock appears to be overvalued.
The current stock price of A$6.85 is trading 2.5% above its estimated GF Value™ of A$6.68.
GuruFocus considers The a2 Milk Co to be Fairly Valued.
Key valuation signals for ASX:A2M:
ROE %: 1.49% (94% below median its 10-year median of 23.59)
GF Value™: A$6.68 vs. price of A$6.85 (2.5% above fair value)
Industry Position: 77.9% below the Consumer Packaged Goods median (#794 of 1915)
No single metric tells the full story. See the ASX:A2M stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
A2 Milk is a New Zealand licensor and marketer of fresh milk, infant formula, and other dairy products that lack the A1 beta-casein protein. The firm was founded in 2000 by Corran McLachlan, who developed a genetic test to determine which proteins a cow produces in its milk, and business partner Howard Paterson. The company has been through a tumultuous history of receivership, legal battles, and strategic shifts, but emerged in its current structure in 2006 and listed publicly in March 2013.
83GF Score
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