With its stock down 36% over the past three months, it is easy to disregard Wells Advanced Materials (Shanghai) (SZSE:301555). However, stock prices are usually driven by a company’s financials over the long term, which in this case look pretty respectable. Particularly, we will be paying attention to Wells Advanced Materials (Shanghai)’s ROE today.
Return on equity or ROE is a key measure used to assess how efficiently a company’s management is utilizing the company’s capital. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company’s shareholders.
View our latest analysis for Wells Advanced Materials (Shanghai)
How Is ROE Calculated?
The formula for ROE is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders’ Equity
So, based on the above formula, the ROE for Wells Advanced Materials (Shanghai) is:
3.8% = CN¥41m ÷ CN¥1.1b (Based…
