최소한 이거라도 - ROE (19/N)

Is a company good simply because it made a large profit? We should look at how much money we invested to create that profit. The metric used for that is ROE. It is the value of net income divided by shareholders 'equity. Now, shareholders' equity is the portion of my money left after subtracting liabilities from total assets. If I

earned 10 billion won with 50 billion won of capital. Then the ROE is 20%. If I earned 20 billion won with 200 billion won, it's 10%. Now, the second amount is larger, but if we assume the same amount was invested, the first one clearly performed better. Is that too obvious? Why is it important whether a

company's ROE is high or low? It's not just about profitability for shareholders, but because it reveals much about the company. We can break down and examine ROE into several factors. Net income divided by sales, sales divided by assets, and assets divided by equity. If you multiply these three, it naturally becomes the original ROE of net income divided by

shareholders 'equity. From that perspective, ROE can be seen as three parts, or divided into five, or even ten, but dividing it into three is considered the most basic viewpoint. Let's examine the three parts one by one: first, second, and third. First is net income divided by sales. This is profitability. How much remains from a

single unit of sales. Now, sales divided by total assets is efficiency. How much sales we generate with the assets we have. The third can be called capital structure or leverage. How much we use borrowed money on top of shareholders' money to conduct business . On the screen you see, this is a case