DuPont Analysis Calculator

Decompose ROE.

Return on equity (%) 24

Step-by-step with your numbers:

1. Values used:

2. Net profit margin = 12 %

3. Asset turnover = 0.8 x

4. Equity multiplier = 2.5 x

5. Return on equity = Net profit margin x Asset turnover x Equity multiplier = 12 x 0.8 x 2.5 = 24%

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ROE = profit margin × asset turnover × equity multiplier.

FAQ

Which lever?

High leverage boosts ROE but adds risk.