ROE Calculator
Calculate return on equity (ROE) for any company. Enter net income and shareholders' equity to find ROE — one of Warren Buffett's most-cited measures of business quality. Optionally add total assets to unlock ROA and the DuPont equity multiplier.
Enter all values in the same unit (millions, billions, or raw dollars).
Total assets minus total liabilities
Unlocks ROA and DuPont multiplier
Enter net income and shareholders' equity to calculate ROE.
Sector ROE benchmarks
ROE varies significantly by sector. Asset-light businesses with strong brands or software margins consistently generate higher ROE than capital-intensive industrials and utilities.
| Sector | Typical ROE Range | Context |
|---|---|---|
| Technology (Software) | 25–60% | Asset-light model; high margins amplify ROE |
| Consumer Staples | 20–40% | Durable brands drive consistent high returns |
| Health Care (Large Pharma) | 20–35% | Patent-protected margins sustain high ROE |
| Consumer Discretionary | 15–35% | Wide range; brand leaders outperform significantly |
| Financials (Banks) | 10–18% | Regulated leverage; ROE most comparable within sector |
| S&P 500 Average | 16–20% | Broad market benchmark (2024 est.) |
| Communication Services | 10–25% | Legacy telcos low; internet platforms high |
| Industrials | 12–22% | Asset intensity caps ROE; best operators exceed 20% |
| Technology (Hardware / Semis) | 15–30% | Cyclical; semis can spike on supercycles |
| Real Estate (REITs) | 5–12% | High depreciation suppresses GAAP net income; use ROE with caution |
| Energy | 8–20% | Commodity-driven; wide swings across the cycle |
| Utilities | 8–14% | Regulated returns; predictable but capped |
| Materials | 8–18% | Cyclical; commodity prices drive variation |
Reference estimates only. ROE shifts with earnings cycles, share buybacks, and leverage changes. Sources: consensus analyst data.
Go deeper: multi-method valuation
ROE measures profitability efficiency. Pair it with valuation multiples and leverage analysis for a complete picture.
Related ratio calculators
Individual ratios are lenses, not verdicts. Pair this with complementary ratios — leverage, profitability, cash flow — for a full-quality read on the business.
Learn more about how Equity Rank weights these models in the methodology or browse the full free tool directory. Still have questions? See the FAQ.
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Frequently asked questions
Common questions about return on equity and profitability analysis.
This tool is for research and educational purposes only. It does not constitute financial advice. ROE can be distorted by high leverage, share buybacks that reduce equity, and one-time items in net income. Always examine ROE alongside ROA, debt levels, and payout ratios. Equity Rank is not a registered investment adviser. Consult a qualified financial professional before making investment decisions.