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      Aster DM Healthcare’s Spinoff of Gulf Hospitals – A Special Situation You Can’t Afford to Miss!

      Aster DM Healthcare’s Spinoff of Gulf Hospitals – A Special Situation You Can’t Afford to Miss!

      An image charging the electric vehicle from e-station and Text written on the right side

      India’s Top Electric Vehicle(EV) Stocks

      Top 5 Textile stocks

      Top 5 Textile Stocks in India: From Cotton to Cash

      multi-bagger stocks for 2025

      5 Multibagger Stocks to keep an eagle-eye for 2025

      Jindal Saw – Strong Earnings Momentum Ahead

      Jindal Saw – Strong Earnings Momentum Ahead

      Kirloskar Group- A Legacy of 134 Years

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      renewable energy stocks in india

      Top Renewable Energy Stocks in India

      blue chip stocks

      Top 5 Blue Chip Stocks to Buy and Invest in 2023

    • Technical Analysis
      Chart Patterns – Holy grail of Stock Market Analysis

      Chart Patterns – Holy grail of Stock Market Analysis

      StockEdge Version Update : 9.0

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      Beat the street with Sector Rotation Strategy

      Beat the street with Sector Rotation Strategy

      StockEdge Version Update 8.2

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      Derivative Analytics

      An Insightful Research Tool For Derivative Analytics

      Introducing Put-Call Ratio a Derivative Indicator in the Market

      Introducing Put-Call Ratio a Derivative Indicator in the Market

      A Powerful Technical Indicator Beta & Beta Scans

      A Powerful Technical Indicator Beta & Beta Scans

      Technical Analysis using Edge Charts

      Technical Analysis using Edge Charts

      adaptive relative strength and static relative strength scans

      What is Adaptive Relative Strength & Static Relative Strength Scans?

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      • Liquidity Ratios
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      high dividend paying stocks

      Identifying High Dividend Paying Stocks

      Understanding the Importance of creating Fundamental Scans

      Understanding the Importance of creating Fundamental Scans

      Using My Combination Scan to Identify best in an Industry

      Using My Combination Scan to Identify best in an Industry

      Cost Income ratio

      Cost to Income Ratio(%)

      Cost of Liability

      Cost of Liabilities (%)

      Operating Cost to Assets Ratio (%)

      Operating Cost to Assets Ratio (%)

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      Simplify stock market analysis with Edge Reports | StockEdge

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      FII/DII Data: Leading Indicators of Stock Market

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      Chart Patterns – Holy grail of Stock Market Analysis

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      StockEdge Version Update : 9.0

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      Powerful Investment Themes for Retail Investors

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      Beat the street with Sector Rotation Strategy

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      What are Value Funds and its Advantages?

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      thematic funds

      Thematic Funds : Everything you need to know

      Understanding Sector Funds and their Benefits to our Portfolio

      Understanding Sector Funds and their Benefits to our Portfolio

      Are Dividend Yield Funds a good option to invest in?

      Are Dividend Yield Funds a good option to invest in?

      What are Contra Funds and their advantages?

      What are Contra Funds and their advantages?

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      RoA

      Significance of Return on Assets (ROA)

      StockEdge by StockEdge
      October 26, 2018
      Reading Time: 2 mins read
      3.4k
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      Table of Contents

      • Impact of Return on Assets
      • Exceptions
      • Formula
      • StockEdge App
      • Bottomline

      Return on assets (RoA) measures the net income produced by total assets during a period by comparing net income to the average total assets. Since company assets sole purpose is to generate revenues and produce profits, this ratio helps both management and investors see how well the company can convert its investments in assets into profits. You can look at ROA as a return on investment for the company since capital assets are often the biggest investment for most companies. In this case, the company invests money into capital assets and the return is measured in profits.

      You can also watch the below video on Everything you want to know about Return on Assets (ROA):

      Impact of Return on Assets

      The return on assets ratio measures how effectively a company can turn earn a return on its investment in assets. In other words, ROA shows how efficiently a company can covert the money used to purchase assets into net income or profits. It only makes sense that a higher ratio is more favorable to investors because it shows that the company is more effectively managing its assets to produce greater amounts of net income. A positive ROA ratio usually indicates an upward profit trend as well.

      Exceptions

      It is useful only for comparing companies in the same industry only since different industries use their assets differently.

      Formula

      Return on Assets= Net Income/Average Total Assets. Suppose a company’s net profit is Rs 1 crore and its total assets is Rs 10 crore, then its return on assets is 1/10=10%.

      StockEdge App

      Nowadays we don’t have to calculate RoA on our own. StockEdge gives us RoA of the last year of any company listed in the stock exchange. We can look and compare RoA of any company and filter out stocks accordingly.

      Suppose we want to look at the RoA of Ashok Leyland of last year. In the Fundamental tab of Ashok Leyland, click on the fundamentals tab, we will get Ratios tab.  Then in the Ratios tab click on Return Ratios, and we get the RoA in miniscule of a second.

      return on assets on StockEdge

      Bottomline

      Return on Assets is an important barometer to gauge the growth and future prospects of a company. With the help, these ready-made parameters you can with the click of a button understand the strength of a company.  These parameters are freely available in every stocks under StockEdge app. So, what are you still thinking ? if you still do not have the StockEdge app, download it right now to use this free feature.

      Click here to know https://www.blog.stockedge.com/

      If you want to know more then click on this link : https://www.youtube.com/watch?v=ECzMA5WWZaM

      Tags: Fundamental analysisfundamental parameterfundamental ratioFundamental scansReturn RatiosStockedge appvaluation ratio
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      Comments 3

      1. buninqueinfoshare ya Hiralal Bopalkar says:
        3 years ago

        Nicely explained, an Appreciable article.

        • Ganga says:
          3 years ago

          keep Supporting us and we will create such type of content for you

      2. Govind patidar says:
        2 years ago

        Your blog is greater than zerodha varsity I love your blog thank you very much for support

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