| ROA, or Return on Assets, is a financial metric that assesses how effectively a company uses its assets to generate profits. It shows how well the company converts its investments in assets into earnings. ROA is useful for comparing the performance of companies in the same industry, as it highlights the efficiency with which a company utilizes its resources. A higher ROA indicates that the company is generating more income per unit of assets, signaling better management of its resources. However, it doesn't account for financial leverage. |
