» Return On Equity (DuPont Model)

Initial Data


Net income ×  Net Sales ×  Total Assets =  Return on Equity (ROE)
%
Net Sales Total Assets Total equity
Profit Margin Total Asset Turnover Financial Leverage ROE
0.27  × 0.16  × 2.06  =  8.65 %
Profit Margin Total Asset Turnover ROA
0.27  × 0.16  =  4.19 %
 
 

DuPont Model (ROE)

DuPont analysis is an expression which breaks ROE (Return On Equity) into three parts: 1. Operating efficiency, 2. Asset use efficiency, 3. Financial leverage.

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