DuPont analysis calculator
Shows where return on equity comes from: profitability, asset efficiency or debt.
Loading the tool…
Processing and privacy: The result is calculated inside your browser and your data is not sent to any server.
How to use it
- Enter net income, revenue, average total assets and average shareholders equity.
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
ROE = net margin × asset turnover × equity multiplier = (net income ÷ revenue) × (revenue ÷ assets) × (assets ÷ equity).
Example
Inputs: Net income = 100,000, Revenue = 1,000,000, Average total assets = 2,000,000, Average shareholders equity = 800,000. Result: Return on equity (ROE): 12.5%; Net profit margin: 10%; Asset turnover: 0.5 times.
Limits and caveats
- The three-step version does not separate the effect of taxes and interest; the five-step version does.
- Use average assets and equity for the same period in which the profit was earned.
Questions about this tool
Why break ROE down instead of reading it directly?
Two companies can post the same ROE, one from high margins and one from heavy debt, with very different risk.
What is the equity multiplier?
Assets divided by equity; the higher it is, the more the company leans on debt.
Does the product equal net income ÷ equity?
Yes, revenue and assets cancel out in the product, leaving net income ÷ equity.