ROE=ROEAverageTotalEquityNetIncome=ROAProfit MarginTax BurdenPretaxIncomeNetIncome∗Interest BurdenPretaxIncomeNetIncome∗Return On Sales (ROS)RevenueEBIT∗Assets TurnoverAverageTotalAssetsRevenue∗Equity Multiplier(Financial Leverage)AverageTotalEquityAverageTotalAssets
ROE =
NI/EBT *
EBT/EBIT *
EBIT/Revenue *
Asset Turnover *
Company Equity Multiplier
28.02%
80.65%
99.49%
26.89%
107.79%
1.20
ROA =
Net Profit Margin *
Asset Turnover
23.26%
21.58%
107.79%
The company's tax burden is (Net income ÷ Pretax profit). This is the proportion of the company's profits retained after paying income taxes. [NI/EBT]
The company's interest burden is (Pretax income ÷ EBIT). This will be 1.00 for a firm with no debt or financial leverage. [EBT/EBIT]
The company's operating income margin or return on sales (ROS) is (EBIT ÷ Revenue). This is the operating income per dollar of sales. [EBIT/Revenue]
The company's asset turnover (ATO) is (Revenue ÷ Average Total Assets).
The company's equity multiplier is (Average Total Assets ÷ Average Total Equity). This is a measure of financial leverage.