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Return on equity
Return on equity (ROE) measures how much profit a company generates for each dollar shareholders have invested in it. A high ROE can reflect a genuinely efficient business, or simply a lot of debt relative to equity — checking it alongside debt-to-equity is how those two cases are told apart.
ROE = Net income / Shareholders' equitySee also
This explains what return on equity measures. It isn't investment advice — see the disclaimer.