Can Herc Holdings Inc. (NYSE:HRI) Maintain Its Strong Returns?
Can Herc Holdings Inc. (NYSE:HRI) Maintain Its Strong Returns?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Herc Holdings Inc. (NYSE:HRI).
雖然一些投資者已經精通財務指標（致敬），但本文是爲那些想了解淨資產收益率（ROE）及其重要性的人準備的。 通過實踐學習，我們將研究ROE，以更好地了解Herc Holdings Inc.（NYSE：HRI）
ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. Put another way, it reveals the company's success at turning shareholder investments into profits.
ROE或股東權益報酬率是一種有用的工具，用於評估一家公司能否有效地利用來自股東的投資產生回報。換句話說，它揭示了公司將股東的投資變成利潤的成功程度。
How Is ROE Calculated?
淨資產收益率怎麼計算？
The formula for return on equity is:
權益回報率的計算公式是：
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
淨資產收益率 = 淨利潤（從持續經營中獲得）÷ 股東權益
So, based on the above formula, the ROE for Herc Holdings is:
因此，根據上述公式，Herc Holdings的ROE是：
26% = US$345m ÷ US$1.3b (Based on the trailing twelve months to March 2024).
26％= US $ 345m÷US $ 1.3b（基於截至2024年3月的過去十二個月）。
The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.26 in profit.
“回報”是指公司過去一年的盈利。將其概念化的一種方法是，對於每個$ 1股東資本，公司獲得了 $ 0.26的利潤。
Does Herc Holdings Have A Good Return On Equity?
Herc Holdings的淨資產收益率如何？
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As is clear from the image below, Herc Holdings has a better ROE than the average (17%) in the Trade Distributors industry.
通過將公司的ROE與其行業平均水平進行比較，我們可以快速了解其好壞程度。這種方法的侷限性在於，有些公司與其他公司相當不同，即使屬於同一行業分類。正如下圖所示，Herc Holdings的ROE優於Trade Distributors行業的平均水平（17％）。
That is a good sign. Bear in mind, a high ROE doesn't always mean superior financial performance. Aside from changes in net income, a high ROE can also be the outcome of high debt relative to equity, which indicates risk. You can see the 3 risks we have identified for Herc Holdings by visiting our risks dashboard for free on our platform here.
這是一個好跡象。請記住，高淨資產收益率並不總是意味着出色的財務表現。除了淨收入的變化外，高淨資產收益率也可以是相對於股權的高額債務的結果，這表明了風險。您可以通過訪問我們的網站查看我們爲Herc Holdings確定的3項風險。風險儀表板在瀏覽完所有相關因素確定股票購買價格後，ROE是一個有用的公司質量指標。此外，還需要考慮其他因素，例如未來盈利增長以及未來需要投入多少投資。因此，我認爲值得查看這份免費的詳細收益、營收和現金流圖表。
How Does Debt Impact Return On Equity?
債務如何影響股東回報率？
Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
大多數公司需要資金——從某個地方——來增加利潤。投資資金可以來自於前年的利潤（保留收益），發行新股或借款。在前兩種情況下，ROE將捕捉到這種使用資本來增長的情況。在後一種情況下，用於增長的債務將提高回報，但不會影響股東權益。因此，債務的使用可以改善ROE，儘管在惡劣的天氣情況下會帶來額外的風險（比喻而來）.
Herc Holdings' Debt And Its 26% ROE
Herc Holdings顯然使用了大量的債務來提高回報，因爲它的債務資本比例爲2.91。其ROE相當令人印象深刻，但如果不使用債務，它可能會更低。債務確實帶來額外的風險，因此只有在公司從中獲得了一些不錯的回報時才真正值得投入。
Herc Holdings clearly uses a high amount of debt to boost returns, as it has a debt to equity ratio of 2.91. Its ROE is pretty impressive but, it would have probably been lower without the use of debt. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it.
但請注意：Herc Holdings可能並不是最好的股票。因此，請查看此免費的有高ROE和低債務的有趣公司列表。
Conclusion
結論
Return on equity is useful for comparing the quality of different businesses. In our books, the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
對於比較不同業務質量的公司，ROE很有用。在我們的書中，最高質量的公司具有高ROE，儘管其債務較低。如果兩家公司的債務與股本比例大致相同，並且其中一家公司的ROE更高，我通常更喜歡ROE更高的那家公司。
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking this free report on analyst forecasts for the company.
儘管ROE是企業質量的有用指標，但您還需要考慮一系列因素來確定購買股票的正確價格。重要的是要考慮其他因素，例如未來的利潤增長以及今後需要多少投資。因此，我認爲值得查看有關該公司分析師預測的免費報告。
But note: Herc Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
但請注意：Herc Holdings可能不是最好的買入股票。因此，請查看此免費清單，其中包含具有高roe和低債務的有趣公司。
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
對本文有反饋？關於內容有所顧慮？直接和我們聯繫。或者，發送電子郵件至editorial-team (at) simplywallst.com。
這篇文章是Simply Wall St的一般性文章。我們根據歷史數據和分析師預測提供評論，只使用公正的方法論，我們的文章並不意味着提供任何金融建議。文章不構成買賣任何股票的建議，也不考慮您的目標或您的財務狀況。我們的目標是帶給您基本數據驅動的長期關注分析。請注意，我們的分析可能不考慮最新的價格敏感公司公告或定性材料。Simply Wall St沒有任何股票頭寸。
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
對本文有反饋？關於內容有所顧慮？直接和我們聯繫。或者發送電子郵件至editorial-team@simplywallst.com。