Return on Equity Calculator

Calculate Return on Equity (ROE)

Definition of Return on Equity

Return on equity (ROE) is equal to net income for the fiscal year (after preferred stock dividends but before common stock dividends) divided by total equity (excluding preferred stock), expressed as a percentage. It measures the return on owner equity for common shareholders and measures the efficiency with which a company generates profits from each shareholder equity unit.

Return on equity formula

Return on equity = net income after tax/shareholders 'equity