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.
Direct Digital Holdings's 5-Year RORE % for the quarter that ended in Mar. 2026 was 23.71%.
The industry rank for Direct Digital Holdings's 5-Year RORE % or its related term are showing as below:
DRCT's 5-Year RORE % is ranked better than 70.84% of 878
companies
in the Media - Diversified industry
Industry Median: 0.235
vs DRCT: 23.71
Direct Digital Holdings (NAS:DRCT) 5-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, 5-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.
Direct Digital Holdings 5-Year RORE % Related Terms
Direct Digital Holdings 5-Year RORE % Historical 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.
For the Advertising Agencies subindustry, Direct Digital Holdings's 5-Year RORE %, along with its competitors' market caps and 5-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.
Direct Digital Holdings 5-Year RORE % vs Media - Diversified Industry
For the Media - Diversified industry and Communication Services sector, Direct Digital Holdings's 5-Year RORE % distribution charts can be found below:
* The bar in red indicates where Direct Digital Holdings's 5-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 5-Year RORE %, the most recent and first period EPS (Diluted) is the trailing twelve months (TTM) data ended in Mar. 2026 and 5-year before.
Direct Digital Holdings (DRCT) has a 5-Year RORE % of 23.71 as of Mar. 2026. 5-Year RORE % shows how much a company earns by reinvesting its retained earnings in 5-year. View historical data on Direct Digital Holdings and its competitors. According to the industry distribution chart, Direct Digital Holdings ranks #256 out of 878 companies in the Media - Diversified industry, placing it in the top 29.2%.
Is Direct Digital Holdings' 5-Year RORE % too high?
Direct Digital Holdings' current 5-Year RORE % is 23.71. The Media - Diversified industry median 5-Year RORE % is 0.24. Direct Digital Holdings' value of 23.71 is 9989.4% above this industry median. Based on the distribution chart, Direct Digital Holdings ranks #256 out of 878 companies in the Media - Diversified industry, which is above the industry midpoint. Overall, Direct Digital Holdings has a GF Score™ of 43/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Direct Digital Holdings' 5-Year RORE % compare to HAO and DBMM?
According to the Media - Diversified industry distribution chart, Direct Digital Holdings ranks #256 out of 878 companies for 5-Year RORE %. This puts Direct Digital Holdings in the upper half of its industry. The industry median 5-Year RORE % is 0.24. Direct Digital Holdings' value of 23.71 is 9989.4% 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 5-Year RORE % for a Media - Diversified company?
The median 5-Year RORE % among Media - Diversified companies is 0.24, based on 878 companies in the industry. Companies in the top quartile (top 25%) have a 5-Year RORE % significantly above this median, while those in the bottom quartile fall well below. However, 5-Year RORE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Direct Digital Holdings's current 5-Year RORE % of 23.71 is 9989.4% 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 5-Year RORE % mean?
A high 5-Year RORE % can signal that a stock is expensive relative to its fundamentals. 5-Year RORE % shows how much a company earns by reinvesting its retained earnings in 5-year. View historical data on Direct Digital Holdings and its competitors. For the Media - Diversified industry, the median 5-Year RORE % is 0.24 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Direct Digital Holdings's current 5-Year RORE % is 23.71. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Direct Digital Holdings stock overvalued right now?
Based on GuruFocus' analysis, Direct Digital Holdings (DRCT) is currently considered Possible Value Trap. The stock's GF Value™ is $20.83, compared to a current price of $2.79 — trading 86.6% below its estimated fair value. The current 5-Year RORE % is 23.71 and 9989.4% above the Media - Diversified industry median of 0.24. Direct Digital Holdings' overall GF Score™ is 43/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 5-Year RORE % calculated?
5-Year RORE % is calculated from a company's financial statements. For Direct Digital Holdings (DRCT), the current 5-Year RORE % is 23.71 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 Direct Digital Holdings (DRCT) Overvalued in 2026?
Based on GuruFocus' analysis, Direct Digital Holdings stock appears to be undervalued.
The current stock price of $2.79 is trading 86.6% below its estimated GF Value™ of $20.83.
GuruFocus considers Direct Digital Holdings to be Possible Value Trap.
Key valuation signals for DRCT:
5-Year RORE %: 23.71
GF Value™: $20.83 vs. price of $2.79 (86.6% below fair value)
Industry Position: 9989.4% above the Media - Diversified median (#256 of 878)
No single metric tells the full story. See the DRCT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Direct Digital Holdings Inc is an end-to-end, full-service programmatic advertising platform focused on providing advertising technology, data-driven campaign optimization, and other solutions to underserved and less efficient markets on both the buy-side and sell-side of the digital advertising ecosystem. The company operates two reportable segments: sell-side advertising, which includes the results of Colossus Media, and buy-side advertising, which includes the results of Orange 142 and Huddled Masses. All of the company's revenues are attributed to the United States.
43GF Score
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