Free tool

DuPont analysis calculator

See why return on equity is high or low. Enter net income, sales, average assets and average equity.

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Net income ($)

Sales ($)

Average total assets ($)

Average equity ($)

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How it works

ROE = net profit margin x asset turnover x equity multiplier. Margin shows profit on each sale, turnover shows how hard assets work, and the multiplier shows how much of the business is financed by debt instead of equity.

FAQ

About this calculator

Why break ROE into three parts?

Two businesses can earn the same ROE in different ways: high margins, fast turnover or heavy debt. The split shows which one is driving the result.

Is a high equity multiplier bad?

It means more debt relative to equity. That can raise ROE but also raises risk, so lenders look at it closely.

Where do I find the numbers?

Net income and sales are on the profit and loss. Assets and equity are on the balance sheet.

Is anything saved?

No. The math runs in your browser and nothing you enter is sent to us.

Is this tax or financial advice?

No. It is a calculator for general information. Check the numbers against your own records, and ask an accountant before you act on them.

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Do it yourself

Financial Ratio Analysis Workbook

Enter three years of statements and see margins, liquidity, leverage and efficiency ratios side by side, with what each one means in plain English.

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