How do you calculate Return on Equity?
im doing it on UPS, and i found on yahoo finance that it’s 2.76%, but when i calculate it i end up with this:
Return on Equity: total assets – liabilities = shareholders equity
Shareholders equity average beginning ending year divided by 2(15482000 + 12183000 = 27665000)
Net profit divided by shareholders average equity
(382,000,000 / 27665000) = 13.8%
roe=13.8%
am i plugging in wrong numbers?
May 18th, 2010 at 12:46 am
Never seen that calculation before.
Most people look at Dividend yield which is Dividend/current share price.
There are lots of other calculations but you need to state exactly what you are calculating as Return on Equity is too general.