Return on Equity Calculator
Our Return on Equity Calculator is very easy to use for everyone. And gives immediate response to calculations.
ROE: 0.00%
Share This Calculator
Related Calculator
About Return on Equity (ROE) Calculator
The Return on Equity Calculator is a tool designed to help estimate the profitability and efficiency of a business. By inputting the net income and total equity, the calculator easy computes the The Return on Equity ( ROE ) percentage, a important financial metric. The Return on Equity (ROE ) measures the company’s ability to generate profit from its shareholders’ equity, to show how effectively it utilizes investment funds. A higher ROE typically indicates better performance and potential for growth, making it a important indicator for investors and stakeholders to evaluate a company’s financial health and make informed decisions about investment and strategy.
Table of Contents
Return on Equity Calculation Formula:
The Return on Equity (ROE) is calculated using the following formula -
ROE=Shareholder′sEquityNetIncome×100%
Return on Equity Calculation Example
Here we will calculate Return on Equity based on the formula given above. For instance, if a company has a net income of $ 500,000 and shareholder's equity of $ 2,000,000, the ROE would be -
ROE=2,000,000500,000×100%=25%