fbpx

Return on equity - key figures simply explained

Return on equity is the ratio of a company's profit to equity. As a rule, the net income of the last year reported is used for the calculation.
Reading time: <1 minute

Loading

TransparentShare - Return on Equity

Definition: return on equity

Return on equity is the ratio of a company's profit to equity. As a rule, the net income of the last year reported is used for the calculation.



Significance for the evaluation

The higher the return on equity, the more economically a company operates. A high return on equity can be seen as protection against bad times.
We rate a return on equity of more than 15% as positive.

Calculation

Return on equity in % = (net income / equity) * 100

Example

Lufthansa (on April 16, 2019): return on equity = (2,196 million / 9,573 million) * 100 = 22.94%

Other interesting articles:

Loading

Share post

The last posts

3 undervalued stocks with potential (week 26)

3 undervalued stocks with potential (week 26)

We have selected 3 stocks that have fallen sharply in the last 12 months and…
5 top companies with impressive dividend yields in July 2024

5 top companies with impressive dividend yields in July 2024

Discover top companies with impressive dividend yields now! Invest wisely in July 2024 and secure attractive...
Top stocks in focus: The 5 most successful stocks in May 2024

Top stocks in focus: The 5 most successful stocks in May 2024

These 5 top stocks are the high performers in May 2024: SAF-Holland, AlzChem Group, MPH Health…

Simply find the cheapest depot!

Compare now without obligation and without specifying an email address and find the cheapest depot.

OnVista Bank - The new trading freedom

Test for 14 days

Ready to go in 30 seconds

* Without specifying a credit card

en_US
Free stock analysis
Get 1 month of TransparentShare Premium for free!*