Posted inAll sectors / Finance & Control / Financial

Return on Equity (ROE)

Definition of this KPI:
Return on Equity (ROE) is a fundamental financial metric that measures a company's profitability and financial performance in relation to its shareholders' equity. It provides insights into how efficiently a company uses its shareholders' investments to generate earnings and is a key performance indicator (KPI) of financial health and performance.

  • This KPI can be calculated as: Net income / Sharholders equity
  • The KPI will be measured as: ratio (number)
  • How to interpret the KPI: higher is better
  • The strategic objective to measure with this KPI: Financial stability
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