Glossary

Glossary

Glossary

Return on Equity (ROE)

Return on Equity (ROE)

Definition

Measures how effectively a company uses its shareholders' equity to generate profits. It is calculated by dividing net income by shareholders' equity and is expressed as a percentage. A higher ROE indicates better financial performance and efficient use of equity​ (Corporate Finance Institute)​​ (Nanonets)​​ (Stock Analysis)​.

Measures how effectively a company uses its shareholders' equity to generate profits. It is calculated by dividing net income by shareholders' equity and is expressed as a percentage. A higher ROE indicates better financial performance and efficient use of equity​ (Corporate Finance Institute)​​ (Nanonets)​​ (Stock Analysis)​.

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