Return on Equity (ROE) Calculator
Enter net income and shareholder equity to calculate Return on Equity (ROE).
Return on Equity (ROE) Calculator
Calculate Return on Equity (ROE), a key profitability ratio measuring how efficiently a company generates profit from shareholders' equity.
This calculator provides an estimate for general informational purposes only. It is not a substitute for professional financial, mechanical or engineering advice.
ROE measures how much profit a company generates for each dollar of shareholders' equity, calculated by dividing net income by shareholder equity.
Example
- With the default values shown above, this calculator returns: Return on Equity (ROE) ≈ 15.00.
Frequently Asked Questions
What is the formula?
ROE = (Net Income ÷ Shareholder Equity) × 100.
What is considered a good ROE?
It varies by industry, but ROE in the 15–20% range is often considered strong; very high ROE can sometimes indicate high debt levels (financial leverage) rather than pure operating efficiency.