Return on Assets ROA Ratio : Formula and “Good” ROA Defined
The ROA figure gives investors an idea of how effective the company is in converting the money it invests into net income. The higher the ROA number, the better because the company can earn more money with a smaller investment. ROA for public companies can vary substantially and are highly dependent on the industry in which they function. The ROA for a tech company won’t necessarily correspond to that of a food and beverage company. It’s best to compare a company’s ROA against its previous ROA numbers or a similar company’s ROA when using it as a comparative measure. Both… Read More