ROA % 3 Mo (Last FY Qtr)

Return on assets (ROA) measures a firm's performance in using assets to generate earnings independent of how the firm financed acquisition of those assets. ROA answers the question: how well has the firm done in conducting its operations independent of financing assets?`

Example
For example, a major software company was earning more than 20% on its assets-an incredible level of profitability. For every $1 of assets, the company was able to produce more than $0.20 of profits.



Calculation
ROA = (Net Income + Interest Expense Net of Income Tax Savings) / (Average Total Assets)

For the Pros
ROA has a particular relevance to the lenders, or creditors, of a firm. Additionally, common shareholders find ROA useful in assessing financial leverge.

Available Time Periods
As of Most Recent Fiscal Year End (FY 1): 1 Year
As of Most Recent Quarter End (Last FY Qtr): 3 Month