Return on Assets (ROA) Calculator Measure how efficiently a company turns assets into profit — with benchmarks, trend ana...
Return on Assets (ROA) Calculator
Measure how efficiently a company turns assets into profit — with benchmarks, trend analysis, and DuPont insights.
Return on Assets (ROA)** measures how profitable a company is relative to its total assets:
Formula**:
$$\text{ROA} = \frac{\text{Net Income}}{\text{Total Assets}} \times 100\%$$
✅ Alternative (more accurate)**:
$$\text{ROA} = \frac{\text{Net Income}}{\text{Average Total Assets}} \quad \text{where} \quad \text{Average Assets} = \frac{\text{Assets}_{\text{Start}} + \text{Assets}_{\text{End}}}{2}$$
Example: $15M net income / $200M assets = **7.5% ROA** → For every $1 in assets, the firm generates $0.075 in profit.
⚠️ Don’t confuse ROA with:
- ROE (Return on Equity)** = Net Income / Shareholders’ Equity → Higher leverage inflates ROE — ROA is better for cross-company comparisons.
- ROIC (Return on Invested Capital)** = NOPAT / (Debt + Equity − Cash) → Focuses on *productive* capital, excludes excess cash.
- ROI (Return on Investment)** = (Gain − Cost) / Cost → Project-level, not firm-wide.
✅ DuPont ROA** = Profit Margin × Asset Turnover → Reveals *why* ROA is high/low: pricing power? operational efficiency?
| Industry | Avg. ROA | Top Performers |
|---|---|---|
| Technology | 12.5% | Apple (24.3%), Microsoft (18.1%) |
| Retail | 6.8% | Walmart (8.2%), Costco (7.9%) |
| Manufacturing | 5.4% | Caterpillar (6.7%), 3M (4.2%) |
| Utilities | 3.2% | Duke Energy (3.8%), NextEra (2.9%) |
| Financial | 1.1% | JPMorgan (1.4%), Bank of America (1.0%) |
📉 Interpretation**:
- >10%**: Exceptional asset efficiency (tech, SaaS)
- 5–10%**: Healthy (consumer, industrial)
- <3%**: Capital-intensive or low-margin (utilities, banks)
🔍 Source: NYU Stern, S&P Global, Q1 2025
➡️ Standard ROA
Use year-end balance sheet and income statement figures — ideal for quick screening.
➡️ Average Assets ROA
More accurate for seasonal or growing firms — averages assets over the year.
You’ll get:
- ROA % with industry comparison
- DuPont breakdown: Profit Margin × Asset Turnover
- Performance rating (Strong/Moderate/Weak)
- SVG benchmark bar chart
Note: Net Income should be after tax and extraordinary items. Exclude non-recurring gains/losses for trend analysis.