SGA Efficiency Trend

Strips goodwill and intangible assets from both equity and total assets to reveal the hard-asset equity cushion. This is a more conservative view of financial health because goodwill can be impaired during downturns, wiping out paper equity. Banks and regulators often focus on tangible equity.

Above 30% is strong. Between 10-30% is moderate. Below 10% means the balance sheet relies heavily on intangible assets - if goodwill gets written down, equity could vanish quickly. Serial acquirers often have low tangible equity ratios.

Related metrics: Return on Equity (ROE), Return on Assets (ROA), Return on Invested Capital (ROIC). (Updated 2026)