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ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is four times the quarterly (Dec. 2017) net income data. The Revenue data used here is four times the quarterly (Dec. 2017) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Electrical Equipment & Parts subindustry, Emgee Cablesmmunications's ROE %, along with its competitors' market caps and ROE % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Emgee Cablesmmunications ROE % vs Industrial Products Industry
For the Industrial Products industry and Industrials sector, Emgee Cablesmmunications's ROE % distribution charts can be found below:
* The bar in red indicates where Emgee Cablesmmunications's ROE % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Dec. 2017) net income data.
ROE % is displayed in the 30-year financial page.
Emgee Cablesmmunications (BOM:530333) has a ROE % of 8.51% as of Dec. 2017. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Emgee Cablesmmunications and its competitors.
Is Emgee Cablesmmunications' ROE % too high?
Emgee Cablesmmunications' current ROE % is 8.51%. The Industrial Products industry median ROE % is 5.90. Emgee Cablesmmunications' value of 8.51% is 44.4% above this industry median.
How does Emgee Cablesmmunications' ROE % compare to ALPP and WAYS?
Emgee Cablesmmunications' ROE % of 8.51% can be compared against companies in the Industrial Products industry. The industry median ROE % is 5.90. Emgee Cablesmmunications' value of 8.51% is 44.4% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for an Industrial Products company?
The median ROE % among Industrial Products companies is 5.90, based on 3,006 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Emgee Cablesmmunications's current ROE % of 8.51% is 44.4% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Emgee Cablesmmunications and its competitors. For the Industrial Products industry, the median ROE % is 5.90 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Emgee Cablesmmunications's current ROE % is 8.51%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Emgee Cablesmmunications stock overvalued right now?
Emgee Cablesmmunications (BOM:530333) has a current ROE % of 8.51%. The current ROE % is 8.51% and 44.4% above the Industrial Products industry median of 5.90. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For Emgee Cablesmmunications (BOM:530333), the current ROE % is 8.51% as of Dec. 2017. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Emgee Cables & Communications Ltd is engaged in the manufacture and trade of wires and cables. The company produces copper and copper alloy, wires and conductors, Polymerization of vinyl chloride (PVC) insulated wire and cables, electrical and electronic items, does power transmission and distribution projects on turnkey basis and engineering solutions. The company gives services to energy, construction, consumer and industrial sectors, pump manufactures, aerospace, medical, automobile, telecommunication, electronic, railways, and defense sectors. It derives most of its revenues from the sale of the wires and cables business and has operations spread across India.
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