# Return on Equity Calculator

Return on Equity Calculator

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## What is Return on Equity?

Return on Equity (ROE) is a measure of a company’s profitability that shows how much profit a company generates with the money shareholders have invested. It is calculated by dividing a company’s net income by its total equity, and is expressed as a percentage. ROE is a key indicator of a company’s financial health and performance, and is used to compare the profitability of different companies.

## What is Return on Equity Calculator?

A Return on Equity Calculator is a tool used to measure the profitability of a company by calculating the return on equity (ROE). ROE is a measure of a company’s profitability that takes into account the amount of equity that has been invested in the company. It is calculated by dividing the net income of a company by its total equity. The higher the ROE, the more profitable the company is.

## How to Calculate Return on Equity?

Return on Equity (ROE) is a measure of a company’s profitability that calculates how much profit a company generates with the money shareholders have invested. It is calculated by dividing a company’s net income by its total shareholders’ equity. ROE = Net Income / Shareholders’ Equity For example, if a company has a net income of \$100,000 and total shareholders’ equity of \$500,000, then its ROE would be 20%. ROE = 100,000 / 500,000 = 0.2 = 20%

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