GlossaryReturn on Equity

Return on Equity

ROE

How efficiently a company turns shareholders' capital into profit.

Return on equity is net income as a percentage of shareholder equity — a measure of how efficiently a company turns the capital shareholders have put in (or left in, as retained earnings) into profit. Fisclear tracks ROE as a sector median, refreshed monthly, rather than as a per-stock figure.

The formula

Net IncomeShareholder Equity
= ROE

Why it matters

  • A core measure of capital efficiency — high and durable ROE is a hallmark of a strong business model.
  • Can be inflated by heavy debt (which shrinks the equity denominator), so check it alongside debt-to-equity.
  • Best compared against the sector median, since 'good' ROE varies a lot by industry.

How to read it

< 10%Below-average capital efficiency
10%–20%Solid for most industries
> 20%Strong capital efficiency — common in software, consumer brands

Return on Equity by sector

Live · sector medians
SectorMedian ROE
Technology24.5%
Consumer Staples20.5%
Consumer Discretionary19.5%
Communication Services18.5%
Industrials17.5%
Healthcare15.5%
Unknown15.5%
Energy14.0%
Financials13.5%
Materials13.5%
Utilities10.5%
Real Estate6.5%

Return on Equity isn't stored per-stock in our data — only as a sector median, refreshed monthly. Browse companies by sector for the individual context.

Related terms

Return on Equity — Definition & Live Rankings | Fisclear | Fisclear