Return on equity formula . To calculate ROE, divide a company's net annual income by its shareholders' equity. Multiply the result by 100 to get a percentage. Insider ...

Return on equity is primarily a means of gauging the money-making power of a business. By comparing the three pillars of corporate management — profitability, asset management, and financial ...

In the ROE formula, the numerator is net income or the bottom-line profits reported on a firm’s income statement. The denominator is equity, or, more specifically, shareholders’ equity.