One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. To keep the lesson grounded in practicality, we’ll use ROE to better understand Modine Manufacturing Company (NYSE:MOD). Our data shows Modine Manufacturing has a return on equity of 13% for the last year. That means that for every $1 worth of shareholders’ equity, it generated $0.13 in profit. See our latest analysis for Modine Manufacturing How Do I Calculate ROE? The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders’ Equity Or for Modine Manufacturing: 13% = US$71m ÷ US$546m (Based on the trailing twelve months to June 2019.) It’s easy to understand the ‘net profit’ part of that equation, but ‘shareholders’ equity’ requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. The easiest way to calculate shareholders’ equity is to subtract the company’s total liabilities from the total assets. What Does ROE Mean? ROE measures a company’s profitability against the profit it retains, and any outside investments. The ‘return’… Read full this story
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Modine Manufacturing Company (NYSE:MOD) Has A ROE Of 13% have 275 words, post on finance.yahoo.com at October 8, 2019. This is cached page on Game Breaking News. If you want remove this page, please contact us.