What is shareholders' equity?Shareholders' Equity
What's left after subtracting liabilities from assets, which belongs to shareholders; also called net assets.
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- Fundamental AnalysisThe Balance Sheet: How Solid Is the Foundation?
Everything a company owns (assets) = what it owes others (liabilities) + what belongs to shareholders (equity). This equation always holds.
- Fundamental AnalysisROE and DuPont Analysis
Three companies can all have a 15% ROE: one through high margins, one by selling fast, one by borrowing. DuPont analysis splits ROE into three parts to show how a company makes money and the risks behind it.
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Go to “The Balance Sheet: How Solid Is the Foundation?”