Friday, August 10, 2018

How ROA and ROE give a clear picture of corporate health

With all the ratios that investors toss around, it's easy to get confused. Consider return on equity (ROE) and return on assets. (ROA). Because they both measure a kind of return, at first glance these two metrics seem pretty similar. 

Both gauge a company's ability to generate earnings from its investments. But they don't exactly represent the same thing. A closer look at these two ratios reveals some key differences.

Together, however, they provide a clearer representation of a company's performance. Here we look at each ratio and what separates them.

Read more at:
https://www.investopedia.com/investing/roa-and-roe-give-clear-picture-corporate-health/ 

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