Return on Retained Earnings (RORE) is an indicator of a company's growth potential, it shows how much a company earns by reinvesting its retained earnings, i.e. profits after dividend payments.
BAE Systems's 3-Year RORE % for the quarter that ended in Dec. 2025 was 11.94%.
The industry rank for BAE Systems's 3-Year RORE % or its related term are showing as below:
BAESY's 3-Year RORE % is ranked worse than 52.85% of 316
companies
in the Aerospace & Defense industry
Industry Median: 9.565
vs BAESY: 11.94
BAE Systems (OTCPK:BAESY) 3-Year RORE % Explanation
Return on Retained Earnings (RORE) is important to investors because it reveals a company's efficiency and growth potential. A higher RORE indicates a higher return. A high RORE indicates that the company should reinvest profits into the business. A lower RORE suggests that the company should distribute profits to shareholders by paying out dividends, since those dollars aren't generating much additional growth for the company.
There are a several different ways to arrive at the Return on Retained Earnings. The simplest way to calculate it is by using published information on Earnings per Share (EPS) and Dividend per Share (DPS) over a selected period. Here, 3-year period is chosen.
Be Aware
Please keep in mind that the RORE is relative to the nature of the business and its competitors. If another company in the same sector is producing a lower return on retained earnings, it doesn’t necessarily mean it’s a bad investment. It may just suggest the company is older and no longer in a high growth stage. At such a stage in the business cycle, it would be expected to see a lower RORE and higher dividend payout.
BAE Systems 3-Year RORE % Related Terms
BAE Systems 3-Year RORE % Historical Data
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The historical data trend for BAE Systems's 3-Year RORE % 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 Aerospace & Defense subindustry, BAE Systems's 3-Year RORE %, along with its competitors' market caps and 3-Year RORE % 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.
BAE Systems 3-Year RORE % vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, BAE Systems's 3-Year RORE % distribution charts can be found below:
* The bar in red indicates where BAE Systems's 3-Year RORE % 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 3-Year RORE %, the most recent and first period EPS (Diluted) is the trailing twelve months (TTM) data ended in Dec. 2025 and 3-year before.
BAE Systems (BAESY) has a 3-Year RORE % of 11.94 as of Dec. 2025. 3-Year RORE % shows how much a company earns by reinvesting its retained earnings in 3-year. View historical data on BAE Systems and its competitors. According to the industry distribution chart, BAE Systems ranks #167 out of 316 companies in the Aerospace & Defense industry, placing it in the top 52.8%.
Is BAE Systems' 3-Year RORE % too high?
BAE Systems' current 3-Year RORE % is 11.94. The Aerospace & Defense industry median 3-Year RORE % is 9.57. BAE Systems' value of 11.94 is 24.8% above this industry median. Based on the distribution chart, BAE Systems ranks #167 out of 316 companies in the Aerospace & Defense industry, which is below the industry midpoint. Overall, BAE Systems has a GF Score™ of 89/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does BAE Systems' 3-Year RORE % compare to SPCX and GE?
According to the Aerospace & Defense industry distribution chart, BAE Systems ranks #167 out of 316 companies for 3-Year RORE %. This places BAE Systems in the lower half of its industry. The industry median 3-Year RORE % is 9.57. BAE Systems' value of 11.94 is 24.8% 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 3-Year RORE % for an Aerospace & Defense company?
The median 3-Year RORE % among Aerospace & Defense companies is 9.57, based on 316 companies in the industry. Companies in the top quartile (top 25%) have a 3-Year RORE % significantly above this median, while those in the bottom quartile fall well below. However, 3-Year RORE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. BAE Systems's current 3-Year RORE % of 11.94 is 24.8% 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 3-Year RORE % mean?
A high 3-Year RORE % can signal that a stock is expensive relative to its fundamentals. 3-Year RORE % shows how much a company earns by reinvesting its retained earnings in 3-year. View historical data on BAE Systems and its competitors. For the Aerospace & Defense industry, the median 3-Year RORE % is 9.57 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. BAE Systems's current 3-Year RORE % is 11.94. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is BAE Systems stock overvalued right now?
Based on GuruFocus' analysis, BAE Systems (BAESY) is currently considered Modestly Overvalued. The stock's GF Value™ is $90.39, compared to a current price of $106.11 — trading 17.4% above its estimated fair value. The current 3-Year RORE % is 11.94 and 24.8% above the Aerospace & Defense industry median of 9.57. BAE Systems' overall GF Score™ is 89/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 3-Year RORE % calculated?
3-Year RORE % is calculated from a company's financial statements. For BAE Systems (BAESY), the current 3-Year RORE % is 11.94 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 BAE Systems (BAESY) Overvalued in 2026?
Based on GuruFocus' analysis, BAE Systems stock appears to be overvalued.
The current stock price of $106.11 is trading 17.4% above its estimated GF Value™ of $90.39.
GuruFocus considers BAE Systems to be Modestly Overvalued.
Key valuation signals for BAESY:
3-Year RORE %: 11.94
GF Value™: $90.39 vs. price of $106.11 (17.4% above fair value)
Industry Position: 24.8% above the Aerospace & Defense median (#167 of 316)
No single metric tells the full story. See the BAESY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
BAE Systems is a British global defense, security, and aerospace company and the largest defense contractor in Europe; it is one of six prime contractors to the US Department of Defense. For reporting purposes, the company has five operating segments: electronics systems is the group's US- and UK-based electronic warfare systems; the cyber, security, and intelligence segment supplies intelligence and security solutions to the US government; platforms and services manufactures combat vehicles and munitions and performs ship repair services to the US Defense Department; the air segment includes BAE's share of US and European air programs as well as its businesses in Saudi Arabia and Australia, and the maritime segment comprises UK land- and marine-based activities.
89GF Score
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3-Year RORE % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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