Calculate Return on Equity (ROE) to measure how effectively a company uses shareholders' equity to generate profit. A higher ROE indicates more efficient management and is a key metric for evaluating investment attractiveness.
Divides net income by average shareholders' equity and multiplies by 100 to express as a percentage. An ROE above 15% is generally considered strong.
Compute your DTI ratio to assess loan eligibility and financial health.
Measure financial leverage using the debt-to-equity ratio.
Evaluate short-term liquidity with the current ratio.
Measure immediate liquidity using the quick (acid-test) ratio.
Evaluate stock valuation using the Price-to-Earnings ratio.
Assess asset efficiency with the Return on Assets ratio.
