A »To calculate Return on Equity (ROE), divide net income by total shareholder equity. ROE measures a company's profitability by assessing how efficiently it generates profits from shareholders' equity. A higher ROE indicates better financial performance and more effective use of equity, typically above 15% is considered good.

A »Return on Equity (ROE) measures a company's profitability by revealing how much profit it generates with shareholders' equity. Calculate it using: ROE = Net Income / Shareholders' Equity. For example, if a company earns $100,000 with $500,000 in equity, ROE is 20%. A higher ROE indicates effective management and profitable use of equity. However, compare it within the same industry for accurate interpretation.

A »To calculate ROE, divide net income by total shareholder equity. A higher ROE indicates a company is generating more profits from shareholder equity. For example, an ROE of 20% means a company generates $0.20 in net income for every dollar of shareholder equity, indicating efficient use of equity.