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Finance Dictionary and Glossary of Investment Terms
Return On Assets - ROA
Definition 1.
A useful indicator of how profitable a company is relative to its total assets. Calculated by dividing a company's annual earnings by its total assets, ROA is displayed as a percentage. Sometimes this is referred to as Return on Investment.Note: Some people add interest expense back into net income when performing this calculation because it measures operating returns before cost of borrowing.
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