Return on Equity:
Return on Equity is a measure that investors use to "grade" how well management is using money invested by shareholders. Soda Pop Organics had a return on equity of 26%, which means that the company generated 26 cents of earnings for every one dollar that was originally invested into the company. This is about on par with the industry average during 2013 , therefore from an investor standpoint there 3 isn't an immediate cause of concern. However to get a true idea of how well management is using outside funding to the company, investors would need to review income statements from the last three years or continue keep an eye on any changes to ROE. Relying solely on ROE for investment decisions isn't wise as management can manipulate
Return on Equity is a measure that investors use to "grade" how well management is using money invested by shareholders. Soda Pop Organics had a return on equity of 26%, which means that the company generated 26 cents of earnings for every one dollar that was originally invested into the company. This is about on par with the industry average during 2013 , therefore from an investor standpoint there 3 isn't an immediate cause of concern. However to get a true idea of how well management is using outside funding to the company, investors would need to review income statements from the last three years or continue keep an eye on any changes to ROE. Relying solely on ROE for investment decisions isn't wise as management can manipulate