Return on equity is the ratio of net income of a business during a period to its average stockholders' equity during that period. It is a measure of profitability of stockholders' investments. It shows net income as percentage of shareholder equity.
Definition:TheReturn on Equity Ratioshows how efficiently the company utilizes the shareholder’s money in generating the revenues for the firm. The investors are more concerned with this ratio, as they want to see how their funds are being utilized by the company. The return on equity ratio c...
Return on equity (ROE) is defined as the ratio of net income returned by a firm during a specified period (normally an accounting year) to its owners or stockholders. ROE is a simple measure of the past and current profitability of equity investments in the firm. It is calculated by divid...
One such measure of a business's financial health is its return on equity (ROE) ratio. The definition of the ROE ratio is the relationship between a company's net income and its shareholders' equity. Financially speaking, the ROE ratio means the 'return on equity', or the amount o...
Definition:Return on equity, sometimes abbreviated as ROE, is a financial ratio that measures how profitably a company can use the money it gets from equity investors. In other words, it shows how well the company can make profits from the investments from shareholders. Thereturn on equity rati...
Return on Investment Return on Assets (ROA) Return on Capital Employed (ROCE) Equity Ratio: Definition, Interpretations and Conclusions DuPont Analysis Calculator Last Updated on: September 20, 2022 Functions of Financial Management Advantages and Application of Ratio AnalysisSanjay Bulaki Borad ...
Definition of Return on Equity (ROE) Return on Equity is a metric that evaluates a company's net profits in relation to each dollar of equity invested by shareholders. The ROE statistic, which is usually stated in percentages, can be a technique to assess a management team's capital allocati...
The best way to calculate Return on Equity is to base it on the average equity over a certain period of time. This is because there is often a mismatch between thebalance sheetand theincome statement. The formula for return on equity is straightforward: ...
(Definition ofreturn on equityfrom theCambridge Business English Dictionary© Cambridge University Press) Examplesofreturn on equity return on equity The results of these studies revealed the surprising advantages of recognition on employee performance, including its effects on morale, productivity andretur...
e>return on equity. return on equity.return on equity.A definition of the term return on equity is presented. It refers to the ratio of a company's net income as a percentage of shareholders' funds. It is stated that return on equity is easy to calculate and is applicable to the ...