Ringcentral Net Income vs. Return On Equity

RNG Stock  USD 41.35  0.47  1.12%   
Taking into consideration Ringcentral's profitability measurements, Ringcentral may not be well positioned to generate adequate gross income at the present time. It has a very high chance of underperforming in January. Profitability indicators assess Ringcentral's ability to earn profits and add value for shareholders.
 
Net Loss  
First Reported
2011-12-31
Previous Quarter
-14.8 M
Current Value
-7.9 M
Quarterly Volatility
64 M
 
Yuan Drop
 
Covid
At this time, Ringcentral's Operating Cash Flow Sales Ratio is most likely to increase slightly in the upcoming years. The Ringcentral's current Days Of Sales Outstanding is estimated to increase to 63.42, while EV To Sales is projected to decrease to 1.98. At this time, Ringcentral's Change To Netincome is most likely to increase significantly in the upcoming years.
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.540.6984
Significantly Down
Slightly volatile
For Ringcentral profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Ringcentral to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Ringcentral utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Ringcentral's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Ringcentral over time as well as its relative position and ranking within its peers.
  

Ringcentral's Revenue Breakdown by Earning Segment

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For more detail on how to invest in Ringcentral Stock please use our How to Invest in Ringcentral guide.
Is Application Software space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Ringcentral. If investors know Ringcentral will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Ringcentral listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share
(1.04)
Revenue Per Share
25.361
Quarterly Revenue Growth
0.091
Return On Assets
(0.01)
Return On Equity
(6.89)
The market value of Ringcentral is measured differently than its book value, which is the value of Ringcentral that is recorded on the company's balance sheet. Investors also form their own opinion of Ringcentral's value that differs from its market value or its book value, called intrinsic value, which is Ringcentral's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Ringcentral's market value can be influenced by many factors that don't directly affect Ringcentral's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Ringcentral's value and its price as these two are different measures arrived at by different means. Investors typically determine if Ringcentral is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Ringcentral's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Ringcentral Return On Equity vs. Net Income Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Ringcentral's current stock value. Our valuation model uses many indicators to compare Ringcentral value to that of its competitors to determine the firm's financial worth.
Ringcentral is rated below average in net income category among its peers. It is rated below average in return on equity category among its peers . At this time, Ringcentral's Net Loss is most likely to decrease significantly in the upcoming years. Comparative valuation analysis is a catch-all technique that is used if you cannot value Ringcentral by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Ringcentral Return On Equity vs. Net Income

Net income is the profit of a company for the reporting period, which is derived after taking revenues and gains and subtracting all expenses and losses. Net income is one of the most-watched numbers by money managers as well as individual investors.

Ringcentral

Net Income

 = 

(Rev + Gain)

-

(Exp + Loss)

 = 
(165.24 M)
Because income is reported on the Income Statement of a company and is measured in dollars some investors prefer to use Profit Margin, which measures income as a percentage of sales.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Ringcentral

Return On Equity

 = 

Net Income

Total Equity

 = 
-6.89
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.

Ringcentral Return On Equity Comparison

Ringcentral is currently under evaluation in return on equity category among its peers.

Ringcentral Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Ringcentral, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Ringcentral will eventually generate negative long term returns. The profitability progress is the general direction of Ringcentral's change in net profit over the period of time. It can combine multiple indicators of Ringcentral, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-8.2 M-7.8 M
Operating Income-198.8 M-188.9 M
Income Before Tax-156.8 M-164.7 M
Total Other Income Expense Net42 M44.1 M
Net Loss-165.2 M-173.5 M
Income Tax Expense8.4 M8.8 M
Net Loss-402.1 M-382 M
Non Operating Income Net Other-197.8 M-187.9 M
Net Loss-791.2 M-751.7 M
Interest Income5.5 M5.3 M
Net Interest Income-20.7 M-21.7 M
Change To Netincome810.8 M851.4 M
Net Loss(1.74)(1.83)
Income Quality(2.42)(2.30)
Net Income Per E B T 1.05  0.80 

Ringcentral Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Ringcentral. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Ringcentral position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Ringcentral's important profitability drivers and their relationship over time.

Use Ringcentral in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Ringcentral position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ringcentral will appreciate offsetting losses from the drop in the long position's value.

Ringcentral Pair Trading

Ringcentral Pair Trading Analysis

The ability to find closely correlated positions to Ringcentral could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Ringcentral when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Ringcentral - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Ringcentral to buy it.
The correlation of Ringcentral is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Ringcentral moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Ringcentral moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Ringcentral can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

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When determining whether Ringcentral is a strong investment it is important to analyze Ringcentral's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Ringcentral's future performance. For an informed investment choice regarding Ringcentral Stock, refer to the following important reports:
Check out Your Equity Center.
For more detail on how to invest in Ringcentral Stock please use our How to Invest in Ringcentral guide.
You can also try the Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
To fully project Ringcentral's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Ringcentral at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Ringcentral's income statement, its balance sheet, and the statement of cash flows.
Potential Ringcentral investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Ringcentral investors may work on each financial statement separately, they are all related. The changes in Ringcentral's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Ringcentral's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.