Return on Equity (ROE)

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Return on equity (ROE) indicates how efficiently a company uses shareholders’ equity to generate profits. It is calculated by dividing net profit by shareholders’ equity; a higher ROE suggests better profitability, while a low ROE may signal inefficiency【169622808293672†L235-L245】.

Return on equity (ROE) illustration featuring an upward arrow, coins and a rising chart signifying profitability.