Some investors are great at numbers. This story explains Return On Equity (ROE). The Grounds Real Estate Development AG (ETR: AMMN) illustrates ROE. ROE shows how efficiently a firm uses its resources to produce money.
Return on Equity (ROE) shows how well a firm manages its money. It shows how much the company’s investors made.
ROE calculations involve math. ROE equals net profit from the constant business flow. A company’s stockholders own its shareholders’ equity. Company residual interest
This number dance shows Grounds Real Estate Development’s ROE. Compared to 33 million, a slight 3.6% from a 1.2 million machine defines the year before the wedding in December 2022.
This “return” shows money gained in one lunar cycle. For every 1 of stock, you earn 0.04, which sounds like a lovely melody.
Does Grounds Real Estate Development’s ROE pass muster? Comparing its performance to comparable firms might help you solve the riddle.
Compare its return on equity (ROE) to identical firms in its industry. A tiny 3.6%, created from a machine worth 1.2 million and compared to a total of 33 million, describes what happened during the year before the wedding in December 2022.
![Decoding Return on Equity (ROE) Analyzing Grounds Real Estate Development's Financial Performanc22]](https://worldindustryinsights.com/wp-content/uploads/2023/08/Decoding-Return-on-Equity-ROE-Analyzing-Grounds-Real-Estate-Developments-Financial-Performanc22-1-1200x800.jpg)
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Some could call it silent melancholy. However, a poor return on equity (ROE) is not as bad as it seems. Navigate financial information with caution. A corporation with poor return on equity and high debt is like dancing with fire. A lethal dance of risks causes a disaster.
Investigating Debt and property creates an intriguing picture. Grounds Real Estate Development has a high debt-to-equity ratio of 2.46. When ROE is low, and Debt is a dangerous dancing partner, it’s hard to be thrilled. Debt increases risk and makes future choices harder.
The ROE narrative illustrates how a judge might assess a company’s profitability and owner satisfaction. Shoutout to firms earning more than they invested without borrowing much. It’s said, “The higher the ROE, the better the introduction.”
Do not focus just on ROE. People are investigating profit growth avenues amid all the value measure rhetoric. The end invites readers to explore a data fabric that contains predictions.
Keep scrolling until you discover the reward map to take a cheaper journey. It shows firms with strong ROE and low Debt.
Our Reader’s Queries
What does return on equity tell you?
ROE is a ratio that gives investors a glimpse into how well a company’s management team is utilizing the funds that shareholders have invested. Essentially, it measures a corporation’s profitability in relation to the equity of its stockholders. This metric is a valuable tool for assessing a company’s financial health and efficiency.
What is a good ROE ratio?
A return of 15-20% is deemed satisfactory, and ROE is a crucial metric when assessing stocks and other financial ratios. However, it’s crucial to remember that evaluating stocks entails more than just ROE. There are numerous other factors to consider.
What does a 20% ROE mean?
Achieving a 20% return on equity is a remarkable feat for any company. This means that the net income divided by shareholders’ equity is 20%, indicating that the company is effectively managing its equity capital. Shareholders can expect an exceptional return on their investment, making it a wise choice for them.
Is a high or low return on equity better?
A company’s ROE percentage is a key indicator of its profitability. The higher the percentage, the more effective the company is at generating profit from its existing assets. Over time, an increase in ROE suggests that the company is becoming more efficient in its operations.