Return on Equity (ROE) Calculator

LAST UPDATE: September 25th, 2020


Definition – What is Return on Equity?

Return on Equity is a ratio of net income to shareholder equity. It is listed as a percentage.

Formula – How to calculate Return on Equity

Return on Equity = (Net Income / Shareholder’s Equity) x 100%


A company has net income of $2,100 and shareholder equity of $4,000.

Return on Equity = ($2,100 / $4,000) = 0.525 x 100% = 52.5%

Therefore, this company has a return on equity of 52.5%.

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