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DuPont Analysis breaks ROE into three components: profit margin × asset turnover × leverage, revealing operational and financial drivers.
Водич чекор-по-чекор
- 1Input net income, revenue, assets, equity
- 2Calculate each ratio
- 3Analyze which components drive overall ROE
Worked Examples
Влез
High-margin retailer vs. high-turnover grocery
Резултат
Same ROE achieved differently; understand business model differences
Fundamental analysis tool
Common Mistakes to Avoid
- ✕Ignoring leverage effect (riskiness)
- ✕Not comparing to industry peers
Frequently Asked Questions
Which component is most important?
Depends on industry and strategy; all three matter.
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