RETURNS ON EQUITY

RETURN ON EQUITY




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New Companies
Company  ROE  Country Industry
Grupo Aeroportuario del Pacifico17.30%MexicoIndustrials
Uniper SE-21.40%GermanyUtilities
Waste Connections Inc14.40%CanadaIndustrials
Flughafen Zurich8.70%SwitzerlandIndustrials
Itoham Yonekyu Holdings0.00%JapanConsumer Goods
Johnson Controls International PLC14.70%USAIndustrials
Havells India55.60%IndiaIndustrials
Rumo Logistica SA-0.50%BrazilIndustrials
Lifestyle China Grou15.30%Hong-KongConsumer Services
PLDT18.70%PhilippinesTelecommunications
Ingredion19.60%USAConsumer Goods
Peptidream18.70%JapanHealth Care
Mediclinic International plc7.30%UKHealth Care
Vantiv37.50%USAIndustrials
Megmilk Snow Brand12.00%JapanConsumer Goods
Tecmo Koei Holdings10.90%JapanTechnology

Return on Equity ratio measures the ability of a company to generate profits from its own equity (capital less debt).

However, all companies with a return on equity (ROE) high do not necessarily make good investments. Some have high ROE because they require little equity (consulting firm, for example). Other industries require significant infrastructure so they need much more Equity. These two kinds of firms are not comparable only looking at ROE. Indeed, capital-intensive industries are located in markets where barriers to entry limit the competition. High rate of return companies (high ROE) with little equity contribution will be competing more strongly because the entry barriers will be more permeable. In the latter case, the risk of being copied by competitor is higher.

return on equity ROE

Like many financial ratios, ROE only makes sense when one wishes to compare companies in the same sector.

A high ROE provides no immediate benefit. The price of a share is primarily guided by the earnings per share. However, in the context of globalization, large companies operating with corporate governance are trying to accomplish certain goals, including a high return on equity for shareholders, which orient their policies.

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