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Return on capital | Finance & Capital Markets | Khan Academy
 
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Introduction to return on capital and cost of capital. Using these concepts to decide where to invest. Created by Sal Khan. Watch the next lesson: https://www.khanacademy.org/economics-finance-domain/core-finance/investment-vehicles-tutorial/investment-consumption/v/investment-vs-consumption-1?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/investment-vehicles-tutorial/investment-consumption/v/human-capital?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Finance and capital markets on Khan Academy: When are you using capital to create more things (investment) vs. for consumption (we all need to consume a bit to be happy). When you do invest, how do you compare risk to return? Can capital include human abilities? This tutorial hodge-podge covers it all. About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content. For free. For everyone. Forever. #YouCanLearnAnything Subscribe to Khan Academy’s Finance and Capital Markets channel: https://www.youtube.com/channel/UCQ1Rt02HirUvBK2D2-ZO_2g?sub_confirmation=1 Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy
Views: 158363 Khan Academy
RETURN ON INVESTED CAPITAL IS WHAT MATTERS WHEN INVESTING IN THE STOCK MARKET (ROIC)
 
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What do I do? Full-time independent stock market analyst and researcher: https://sven-carlin-research-platform.teachable.com/p/stock-market-research-platform Check the comparative stock list table on my Stock market research platform under curriculum preview! I am also a book author: Modern Value Investing book: https://amzn.to/2lvfH3t More about me and some written reports at the Sven Carlin blog: https://svencarlin.com Stock market for modern value investors Facebook Group: https://www.facebook.com/groups/modernvalueinvesting/ Return on invested capital is one of the most important investment tools according to Charlie Munger. In this video I show how to calculate return on investment capital (ROIC), show two examples and how those affected stock market returns and individual stock returns. ROIC is more than just another financial metric, it is a financial performance indicator that really helps in the value creation of a company and for long term investment returns. ROIC is what made Buffett and Munger billionaires. I explain how you can become a billionaire or just millionaire too by using the roid.
Investopedia Video: The Return On Invested Capital (ROIC)
 
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The ROIC is used to measure how well a company is investing its capital. An advantage of viewing a company's ROIC is that it provides investors an overview of a company's management performance. When a company consistently shows a high ROIC, it is considered a good investment and its shares tend to trade at a higher market price.
Views: 26581 Investopedia
ROIC Return On Invested Capital
 
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How to calculate ROIC (Return On Invested Capital)? We will start off with explaining how ROA (Return On Assets) relates to ROIC, go through the definition of ROIC, and analyze the ROIC calculations of 3 well-known companies. You learn most by applying concepts to real-life situations, so please watch the entire video to get the full picture! ROIC (Return On Invested Capital) is very closely related to the easier to understand metric ROA (Return On Assets), so it makes sense to quickly walk through the definition of ROA first. Return On Assets is simply Net Income divided by Total Assets. To find the Net Income of a company, you take its income statement or profit and loss statement, and go to the very bottom: the line called Net Income, also known as “the bottom line”. This is the numerator in the equation. Then for the denominator, you turn to the balance sheet, and take the number of Total Assets at the bottom on the left. As a balance sheet needs to balance between what a company owns (on the left) and what a company owes (on the right), you could also take the sum of all liabilities and equity, as this is the same number. So Return On Assets is very easy to calculate. If you want to improve the ROA of your company, you either work on initiatives to generate more Net Income, and/or initiatives to lower the Assets base. This is covered in a related video on Return On Assets that I will link to: https://www.youtube.com/watch?v=W5CrcMSBARU What is the definition of ROIC and how does it differ from ROA? Let me walk you through the semi-official definition of ROIC. The reason why I call this semi-official will become clear to you when we go through the examples of real-life companies disclosing their ROIC calculation later in this video. In the numerator of the ROIC calculation are the returns generated for debt & equity holders, in the denominator is Debt plus Equity. More specifically, the returns generated for debt & equity holders are usually defined as after-tax interest + Net Income. Another description for the same thing is Net Operating Profit After Tax (NOPAT). With after-tax interest + Net Income, you start at the bottom of the income statement, and work your way up. With Net Operating Profit After Tax, you start a little higher in the income statement, and work your way down. From this definition of ROIC, you immediately see that the numerator of ROIC under normal economic circumstances is likely to be higher than the numerator of ROA: After-tax interest + Net Income should be higher than Net Income by itself. For the denominator of the equation, the sum of Debt and Equity is lower than Total Assets. If you compare ROIC to ROA, then the numerator in the ROIC equation is higher, and the denominator is lower. So in total, the outcome of the ROIC calculation should always be higher than the outcome of the ROA calculation. A related video compares ROIC to ROE, ROA and ROI: https://www.youtube.com/watch?v=cBaFHRfpOK8&index=15&list=PLKbmcnUUQMllBmY-09UdYNYZHBNHAODpR Let’s compare the way 3M, GM and Home Depot have defined and calculated ROIC, as we are not looking at apples-to-apples comparisons. 3M has nicely summarized why! Return on Invested Capital (ROIC) is not defined under U.S. generally accepted accounting principles. Therefore, ROIC should not be considered a substitute for other measures prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures by other companies. The Company defines ROIC as adjusted net income (net income including non-controlling interest plus after-tax interest expense) divided by average invested capital (equity plus debt)….” So 3M’s definition is very similar to the semi-official definition I showed earlier. Let’s go through each company’s ROIC calculation in detail. Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business and accounting vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investing decisions. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Key Financial Metrics and Ratios: ROA, ROE, and ROIC
 
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Learn key financial metrics & ratios to analyze companies financial statements. By http://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" You’ll learn about the key metrics and ratios used to analyze companies’ financial statements, including Return on Equity (ROE), Return on Assets (ROA), and Return on Invested Capital (ROIC), as well as Inventory Turnover, Receivables Turnover, Payables Turnover, the Current Ratio, and the Asset Turnover Ratio. Table of Contents: 1:15 Why Metrics and Ratios Matter 4:58 Return on Equity (ROE), Return on Assets (ROA), and Return on Invested Capital (ROIC) 10:50 Asset-Based and Turnover-Based Ratios 14:40 Interpretation of Key Metrics and Ratios for Wal-Mart, Amazon, and Salesforce 19:32 Why the Key Metrics and Ratios Are Sometimes Not That Useful Why Metrics and Ratios? They let you evaluate and compare different companies, and see why one company might be worth more (higher valuation multiple) than others. They let you answer questions such as: How much equity is required to generate a certain amount of after-tax profit (Net Income)? How much in assets is required to generate a certain amount of after-tax profit (Net Income)? How much total capital is required to do this? How dependent is a company on its assets? How liquid is the company? Can it meet its obligations? How quickly does it sell all its Inventory, pay its outstanding invoices, and collect its receivables? ROA, ROA, and ROIC Return on Equity (ROE) = Net Income / Average Shareholders’ Equity Return on Assets (ROA) = Net Income / Average Assets Return on Invested Capital (ROIC) = NOPAT / (Total Debt + Equity + Other Long-Term Funding Sources) Return on Equity (ROE): How efficiently is a company using its equity to generate after-tax profits? Return on Assets (ROA): How well is a company using its assets / how dependent is it on them? Return on Invested Capital (ROIC): How well is a company using ALL its capital, or how much capital is required to grow its business? Here, Wal-Mart easily ranks #1 in all these metrics because it has a very high ROE of 20-25%, an ROA of close to 10%, and an ROIC of 13-14%; for Amazon and Salesforce, these numbers are negative or close to 0%. Asset-Based Ratios and Turnover-Based Ratios Asset Turnover Ratio = Revenue / Average Assets How dependent is a company on its asset base to generate revenue? Current Ratio = Current Assets / Current Liabilities How liquid is a company? Can it use its short-term assets to repay its short-term obligations, if required? Inventory Turnover = COGS / Average Inventory How many times per year does a company sell off all its Inventory? Receivables Turnover = Revenue / Average AR How quickly does a company collect its receivables from customers that haven’t paid in cash yet? Payables Turnover = COGS / Average AP (*) How quickly does a company submit cash payment for outstanding invoices? Interpretation of Figures for Wal-Mart, Amazon, and Salesforce On the surface, many of these metrics make Wal-Mart seem like a "better" company - much higher ROE, ROA, and ROIC, and Amazon is negative on some of those! Wal-Mart tends to have higher margins as well, and shows more consistency with those margins. Similar inventory management, but Wal-Mart collects from customers and pays invoices much more quickly than Amazon. Wal-Mart is levered a bit more heavily, though. And yet… Amazon is a much more expensive stock, or at least it was at this point in time, and the market values it much more highly based on metrics such as the P / E ratio. At the time of this analysis, Wal-Mart P / E Ratio = 16x, and Amazon P / E Ratio = 456x! How could that be possible? Is Amazon really nearly 30x as valuable as Wal-Mart with WORSE metrics? Answer: The "Revenue Growth" line tells the whole story here. You're comparing 2 very different companies – one is a mature, predictable, mostly slow-growing firm, and one is growing revenue at 20-30% per year, despite revenue in the tens of billions already. Admittedly, Amazon's valuation still seems ridiculous, but it's not that surprising it's valued more highly than Wal-Mart, given that it's growing 20-30x more quickly. The Bottom-Line: These metrics are MOST useful when comparing companies of similar sizes, growth rates, and margins – not as useful when you're comparing a high-growth company to a stable, mature firm. RESOURCES http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Key-Financial-Metrics-Ratios.xlsx http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Key-Financial-Metrics-Ratios.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Amazon-Financial-Statements.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Salesforce-Financial-Statements.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Walmart-Financial-Statements.pdf
IRR (Internal Rate of Return)
 
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This video explains the concept of IRR (the internal rate of return) and illustrates how to calculate the IRR via an example. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 633465 Edspira
Simple Rate of Return for Capital Budgeting | Managerial Accounting | CMA Exam | Ch 13 P 5
 
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simple rate of return, net present value, NPV, internal rate of return, IRR, payback period, cost of capital, capital budgeting, Present value of single amount, present value of annuity, ordinary annuity, annuity due, future value of annuity, future value of annuity
Return on Investement and Return on Equity (ROI / ROE) - Ratio Analysis
 
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Explained the concept of Return on Capital Employed / Return on Investment (ROI) and Return on Equity (ROE). Student can also watch following lectures for better understanding of the topic: 1. https://www.youtube.com/watch?v=76gMXQBnbps 2. https://www.youtube.com/watch?v=1iYK6s5_Db0 3. https://www.youtube.com/watch?v=hMoOk6iI564 4. https://www.youtube.com/watch?v=H7Etrk0xfAs Download Assignments https://drive.google.com/drive/folders/0BzfDYffb228JNW9WdVJyQlQ2eHc?usp=sharing #Accounting #RatioAnalysis
Views: 48166 CA. Naresh Aggarwal
Real and nominal return | Inflation | Finance & Capital Markets | Khan Academy
 
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Inflation and real and nominal return. Created by Sal Khan. Watch the next lesson: https://www.khanacademy.org/economics-finance-domain/core-finance/inflation-tutorial/real-nominal-return-tut/v/calculating-real-return-in-last-year-dollars?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/inflation-tutorial/inflation-scenarios-tutorial/v/hyperinflation?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Finance and capital markets on Khan Academy: If the value of money is constantly changing, can we compare investment return in the future or past to that earned in the present? This tutorial focuses on how to do this (another good tutorial to watch is the one on "present value"). About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content. For free. For everyone. Forever. #YouCanLearnAnything Subscribe to Khan Academy’s Finance and Capital Markets channel: https://www.youtube.com/channel/UCQ1Rt02HirUvBK2D2-ZO_2g?sub_confirmation=1 Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy
Views: 171516 Khan Academy
NPV - Net Present Value, IRR - Internal Rate of Return, Payback Period.
 
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Project management topic on Capital budgeting techniques - NPV - Net Present Value, IRR - Internal Rate of Return, Payback Period, Profitability Index or Benefit Cost Ratio.
Views: 443054 pmtycoon
ROE (Return On Equity) Explained
 
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What ROE means when evaluating a business and how to calculate ROE?
Views: 41925 KCLau Money
How to calculate Return on Investment
 
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Hi everybody, Ron Phillips here with RPC Invest. https://www.rpcinvest.com/ Like us on Facebook: https://www.facebook.com/WealthAcceleratorSystem/ Blog Post: https://www.rpcinvest.com/blog Don’t forget to Comment and Subscribe if you liked this video! Thanks for checking out this video! A Question i get asked all the time is…. Why should i invest into Real Estate. http://www.ron-phillips.com/3xmarket/ The answer that your will video out if you check out in this video http://vimeo.com/99046951 is that rental properties are not only a great investment if you do it right! They can become a passive income that your can replace your current income with or stay at your day job and build your wealth on the side for an early retirement! With my FREE Wealth Accelerator System you will learn how to Double your Retirement in 45 days or Less! Watch Ron's new webinar here: https://goo.gl/KAd85k Not only will i teach you the RIGHT kind of property to look for, but i’ll also teach you how to create a positive cash flow. With our wealth plan we look at your net worth and set a goal to INCREASE net worth before retirement! You can click this link https://www.rpcinvest.com/weathplan and your current financial situation and set your financial goals and see how your net worth can grow using REAL investment properties! My main goal when i started this was to create a system that would give you FINANCIAL FREEDOM through an investment that gives you double digit returns. https://goo.gl/1MrD7G I don’t charge you a dime to learn this my system! We will help you find the right homes to start growing your WEALTH!
Views: 141492 InvestmentPropCoach
How to Make AWESOME Investments - Return on Invested Capital  |  ROIC
 
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Today we go in depth into one of the most important numbers to look at when investing; return on invested capital! Snapchat username: awc.brandon Facebook: https://www.facebook.com/Aussie-Wealth-Creation-286897268463379/ My Favourite Personal Finance Book: http://amzn.to/2vjLprz My Second Favourite Personal Finance Book: http://amzn.to/2ttsUwV My Camera: http://amzn.to/2utrbYr 2nd Camera: http://amzn.to/2tV0G0S My microphone: http://amzn.to/2uNymtN Feedback: [email protected]
Return on Invested Capital Ratio (ROIC) | Formula & Examples | Calculation
 
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In this Video on Return on Invested Capital (ROIC) we will go in detail and find out why Return on Invested Capital is one of the most significant ratios and many more. 𝐖𝐡𝐚𝐭 𝐢𝐬 𝐑𝐞𝐭𝐮𝐫𝐧 𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐈𝐧𝐯𝐞𝐬𝐭𝐞𝐝 𝐨𝐫 𝐑𝐎𝐈𝐂? ------------------------------------------------------------------------- ROIC is a profitability ratio. Return on Invested Capital ratio helps us to understand how the company is using its invested capital that is equity and debt to generate profit at the end of the day. 𝐑𝐎𝐈𝐂 (𝐑𝐞𝐭𝐮𝐫𝐧 𝐨𝐧 𝐈𝐧𝐯𝐞𝐬𝐭𝐞𝐝 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐅𝐨𝐫𝐦𝐮𝐥𝐚) --------------------------------------------------------------------- Return on Invested Capital Formula = (Net Income – Dividend) / (Debt + Equity) 𝐑𝐎𝐈𝐂 (𝐑𝐞𝐭𝐮𝐫𝐧 𝐨𝐧 𝐈𝐧𝐯𝐞𝐬𝐭𝐞𝐝 𝐂𝐚𝐩𝐢𝐭𝐚𝐥 𝐅𝐨𝐫𝐦𝐮𝐥𝐚) 𝐄𝐱𝐚𝐦𝐩𝐥𝐞 ------------------------------------------------------------------------------------- Net Income = 400,000 Shareholders’ Equity = 600,000 Debt = 20,00,000 Shareholders’ Equity = 600,000 Debt = 20,00,000 Invested Capital = 2600000 Net Income = 400,000 (-) Dividend = - Invested Capital = 2600000 Return on Capital = 15% In this, we took a simple Return on Invested Capital example to illustrate the ROIC Calculation. To know more about Return on Invested Capital (ROIC), you can go to the 𝐥𝐢𝐧𝐤 𝐡𝐞𝐫𝐞: https://www.wallstreetmojo.com/roic-return-invested-capital/
Views: 495 WallStreetMojo
Average Rate of Return (ARR) Calculation
 
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Brief description how to calculate Average Rate of Return. Useful for IBDP Business Management Unit 3.8
Views: 54548 Jason Marchant
Ratio Analysis: Return on Capital Employed (ROCE)
 
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This short revision video introduces the concept of Return on Capital Employed.
Views: 73445 tutor2u
What is return on equity? - MoneyWeek Investment Tutorials
 
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Like this MoneyWeek Video? Want to find out more on equity returns? Go to: http://www.moneyweekvideos.com/what-is-return-on-equity/ now and you'll get free bonus material on this topic, plus a whole host of other videos. Search our whole archive of useful MoneyWeek Videos, including: · The six numbers every investor should know... http://www.moneyweekvideos.com/six-numbers-every-investor-should-know/ · What is GDP? http://www.moneyweekvideos.com/what-is-gdp/ · Why does Starbucks pay so little tax? http://www.moneyweekvideos.com/why-does-starbucks-pay-so-little-tax/ · How capital gains tax works... http://www.moneyweekvideos.com/how-capital-gains-tax-works/ · What is money laundering? http://www.moneyweekvideos.com/what-is-money-laundering/
Views: 109095 MoneyWeek
Six things every investor should know about return on capital employed (ROCE)
 
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Return on capital employed (ROCE) is a key ratio that can reveal lots of useful information about a firm. In this short guide, Tim Bennett explains how it works, when it is most useful and when it can let you down.
Views: 37079 MoneyWeek
Return on Investment (ROI) - Calculation, Formula & Meaning (Hindi)
 
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ROI or Return on Investment calculation, formula and meaning are explained hindi. ROI is a profitability ratio which is also known as Return on Capital. In this video we learn the basics of Return on Investment. In coming videos, we will learn in detail about Return on Assets, Return on Capital Employed (ROCE) and Return on Equity. Related Videos: Return on Equity (ROE): https://youtu.be/K-OhdUGqdzc ROCE (Return on Capital Employed): https://youtu.be/FjWuma0U2x0 Return on Assets: https://youtu.be/7z9jDKNub6U Profitability Ratios: https://youtu.be/pHgiuO2ZYoU Financial Ratios & Analysis: https://youtu.be/CZscpOND3Vs इस वीडियो में ROI या Return on Investment की कैलकुलेशन, फार्मूला और मीनिंग को हिंदी में समझाया गया है। ROI एक प्रोफिटेबिलिटी रेश्यो होता है जिसे रिटर्न ऑन कैपिटल के रूप में भी जाना जाता है। इस वीडियो में हम Return on Investment के बारे में कुछ आधारभूत बातों के बारे में जानेंगे। आने वाले वीडियो में हम रिटर्न ऑन एसेट्स, रिटर्नऑन कैपिटल एम्प्लॉयड (ROCE) और रिटर्न ऑन इक्विटी के बारे में विस्तार से समझेंगे। Share this Video: https://youtu.be/ij7y5e2MVG4 Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is the return on investment or ROI? What is the meaning of ROI? How to calculate ROI? What is the full form of ROI? What is the method of return on investment calculation? How to implement the ROI calculation formula? How to calculate the expected return on investment? How to apply the ROI formula to calculate the profitability ratio of an investment? How to calculate Return on Capital? How to ROI calculation can help making a right investment decision? How to compare investment opportunities using return on investment formula? How to avoid losses using ROI calculation? How to calculate the overall profit of an investment? What is the return on capital? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Linkedin - http://www.linkedin.com/company/asset-yogi Google Plus – https://plus.google.com/+assetyogi-ay Twitter - http://twitter.com/assetyogi Instagram - http://instagram.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Facebook – https://www.facebook.com/assetyogi Hope you liked this video in Hindi on “Return on Investment (ROI)”.
Views: 24140 Asset Yogi
29. What is Return On Equity - Warren Buffett's Favorite Number
 
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Download Preston's 1 page checklist for finding great stock picks: http://buffettsbooks.com/checklist Preston Pysh is the #1 selling Amazon author of two books on Warren Buffett. The books can be found at the following location: http://www.amazon.com/gp/product/0982967624/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=0982967624&linkCode=as2&tag=pypull-20&linkId=EOHYVY7DPUCW3WD4 http://www.amazon.com/gp/product/1939370159/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=1939370159&linkCode=as2&tag=pypull-20&linkId=XRE5CA2QJ3I2OWSW In this lesson, we learned the importance of buying a company that has a strong return on equity. Since the market price of the stocks you buy is dependent on the dividends and the growth of the book value, we can quickly learn that a company that grows it's book value at a faster pace is more valuable. When we assessed two different companies in the video, we created a situation where both companies had the exact same earnings. The difference between the companies was the size of their equity (or book value). When a company with a large amount of book value is compared to a company with less book value, the percent change in their growth will be much more difficult if earnings are similar. When a company consistently has a strong Return on Equity, we know as investors that the management of the company is properly reinvesting the earnings of the business into assets that will continue to grow the capital earned. This is very important since most of the earnings produced by a company are retained and not paid as a dividend. When a disciplined investor purchases companies with a sustained high ROE, their investments compound at a much higher rate than other assets. The great thing with purchasing companies with high ROEs is that it helps alleviate capital gains tax if the security is held for a long period of time.
Views: 128703 Preston Pysh
ACCA F2 Investment Appraisal (Capital Budgeting) NPV, IRR
 
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Net Present Value, Internal Rate of Return ACCA F2 Investment Appraisal (Capital Budgeting) Free lectures for the ACCA F2 Management Accounting / FIA FMA Exams
Views: 26419 OpenTuition
Return On Equity explained
 
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What is Return On Equity? Return On Equity or ROE is a financial ratio that can help you analyze the performance of a company or business unit from the perspective of the shareholder, and compare the financial performance to others. This video takes you through the Return On Equity formula, shows you how to calculate ROE, how to interpret ROE, and gives suggestions on how to improve Return On Equity. Return On Equity links together information from two of the three main financial statements, by taking the bottom line of net profit from the income statement and the equity or shareholder capital amount out of the right hand side of the balance sheet. ROE or Return On Equity is defined as Net Income divided by Equity. In other words, the net profit that a company has generated during a year, divided by the book value of the shareholder capital that a company owes on the balance sheet date. ROE is an important indicator of attractiveness of a business to shareholders. Can the company generate a good return on the equity that investors have invested in it? Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers training in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Investment Checklist Tip# 11 - Return on Capital
 
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Return on Capital aka Return on Invested Capital (ROC or ROIC) is the Rate of Return a business earns on investor (stockholders or bondholders) money that they are investing. This is a good indication of how good the management team is at turning capital into profits. A higher ROC means there is something special about the business, otherwise it’s competitors would have driven down the ROC to lower levels. A high ROC is a very good indicator that the company has a competitive advantage, AKA a wide Moat. If a business doesn’t have any new or innovative products/services, or anything that stands out from the competition, then they are going to have a lower ROC because a competitor can come in and do the same thing and take its customers away from them. REGISTER NOW for our 16-Week Stock Investing and Options Trading Class. For more info, please email me at [email protected] Follow me at: https://go.wallstreetvalue.com/case-study
Views: 71 Wall Street Value
How to Calculate NPV, IRR & ROI in Excel || Net Present Value  || Internal Rate of Return
 
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http://alphabench.com/data/excel-npv-irr-tutorial.html Tutorial demonstrating how to calculate NPV, IRR, and ROI for an investment. Demonstrates manual calculation of present values as well as the use of NPV and IRR functions in Excel. The spreadsheet used can be downloaded at: http://alphabench.com/data/NPV-IRR_STR.xlsx Capital Budgeting includes the analysis of various projects with financial measurements such as Net Present Value (NPV), Internal Rate of Return (IRR) and Return on Investment (ROI). This video discusses all of these concepts briefly while demonstrating the calculation of them using Excel. Excel Functions: NPV IRR
Views: 46582 Matt Macarty
Investment Appraisal - How to Calculate ARR
 
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In this short revision video we explain how to calculate ARR (Average Rate of Return) - one of the three main methods of investment appraisal.
Views: 14210 tutor2u
Airline Financials - Return on Invested Capital - Part 1
 
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ROIC is coming into focus now that the financial condition of the airline industry is improving. Airlines that earn a return that is greater than their cost of capital (WACC) create value for their investors.
Views: 3994 RickZeniRMVideos
How Growth and ROIC Drive Value
 
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A short explanation of The Key Value Driver Formula and how to derive it
Views: 11555 StockViews
ROIC vs ROE vs ROA vs ROI
 
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Return On Invested Capital versus Return On Equity versus Return On Assets versus Return On Investment. Why do we need them, and what are the similarities and differences between these financial metrics? Let’s start with the common factor in these financial metrics. ROIC, ROE, ROA, ROI. Do you see any similarities? Yep! They all start with R O which means Return On, which is then followed by one or more letters of the alphabet. Each of these financial metrics is trying to help you understand how much bang for the buck you get, in more financial terms how much value for money you get. For all of these financial metrics (ROIC, ROE, ROA, ROI), the higher the better, assuming the returns are sustainable and not a one-off. That’s because the formula, the calculation of the financial metrics, is very similar. Put the bang in the numerator, and put the buck in the denominator. In other words, put the outputs or benefits or returns (per year) in the numerator, and the inputs or investment or capital in the denominator. If I invest $1, how much annual return is being generated on that investment. Let’s look at the formula more specifically for each of the four common financial metrics. ROIC, Return On Invested Capital, is calculated as the sum of after-tax interest expense plus net income, divided by the sum of debt plus equity. ROE, Return On Equity, is calculated as net income divided by equity. ROA, Return On Assets, is calculated as net income divided by assets. ROI, Return On Investment, is calculated as benefits or returns divided by investment. Let’s make some meaningful comparisons on a one-to-one basis between these financial metrics. In summary: ROIC, ROE, ROA and ROI are similar metrics, helping you to analyze whether an investment brings value for money. You can choose which financial metric to use for a specific situation. Each metric has a situation where it provides the most relevant perspective. Remember, financial analysis is as much an art as it is a science! Philip de Vroe (The Finance Storyteller) aims to make strategy, #finance and leadership enjoyable and easier to understand. Learn the business and accounting vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Learn how to do #financialanalysis. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Quality: Return on Invested Capital (ROIC)
 
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Learn more about the investment philosophy and Quality Strategy process of Alpha Quant Advisors, LLC, an independent affiliate of Resolute Investment Managers, Inc. Understand why ROIC is a company’s most effective way to measure value creation.
Return on Invested Capital ROIC | Invest in Highly Efficient Businesses!
 
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Do you struggle to understand the ROIC? Here I explain what the ROIC is through 5 common situations to make it easy to understand! The ROIC is a vital part of our low risk stock market strategy so make sure you check out the other videos! MUST USE Stock Market Strategy: https://www.youtube.com/watch?v=GyBd_6FNtC0' Favourite Investing Book: http://amzn.to/2HL8qX6 (Affiliate) Microphone: http://amzn.to/2ot6AC8 (Affiliate) Camera: http://amzn.to/2FtqNPv (Affiliate) Twitter: https://twitter.com/hamish_hodder Email: [email protected] Don't hesitate to message me on twitter or via email for any inquiries or feedback!
Views: 424 Hamish Hodder
ACCA F9 Accounting Rate of Return
 
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ACCA F9 Accounting Rate of Return Free lectures for the ACCA F9 Financial Management To benefit from this lecture, visit opentuition.com to download the free lectures notes used in the lecture and access all our free resources including all F9 lectures, practice tests and Ask the Tutor Forums. http://opentuition.com/acca/f9/ Please go to opentuition to post questions to ACCA F9 Tutor, we do not provide support on youtube. *** Complete list of free ACCA F9 lectures is available on http://opentuition.com/acca/f9/ ***
Views: 7182 OpenTuition
HOW TO MEASURE RETURN ON INVESTED CAPITAL - Dennis Vink
 
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In this video I will explain how to measure financial operating performance with the help of Return on Invested Capital measurement. This video supports the content in the textbook: Finance Basics: from Book Value to Market Value. Also, this video is best used with the website FinanceLogic.nl. Good luck! Dennis
Return On Invested Capital (ROIC): The Paradigm For Linking Corporate Performance To Valuation
 
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In depth discussion of Return on Invested Capital (ROIC), its role in the capital markets, how to calculate it correctly and how to get the most out of the metric. Topics covered: - Core principles behind ROIC - Why more investors don’t use ROIC - How to calculate ROIC - How to scale ROIC - Additional resources - - Case study: Oracle (ORCL) - - Most Attractive stocks - - Most Dangerous stocks - - Fund Ratings - - More free research
Views: 25036 New Constructs
Investopedia Video: Return On Assets (ROA)
 
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Be the first to watch our newest videos on Investopedia Video: http://www.investopedia.com/video/ Return on assets is one of the basic metrics used to evaluate a company's stock. Find out what it can tell you about a stock and learn how to calculate it here. For more on ROA and how it can help you better evaluate companies, check out; Use ROA To Gauge A Company's Profits http://www.investopedia.com/articles/fundamental/04/012804.asp ROA And ROE Give Clear Picture Of Corporate Health http://www.investopedia.com/articles/basics/05/052005.asp
Views: 88580 Investopedia
Finance Lecture - Risk, Return and CAPM
 
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If you found this video helpful, click the below link to get some additional free study materials to help you succeed in your finance course! http://www.coursecrusher.io/freestudypack/
Views: 205202 Brad Simon
Return on Invested Capital: What It is and Its Pros and Cons
 
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Check out our premium stock screener to use screen based on ROIC and more: https://www.sixjupiter.com Key Points About Return on Invested Capital (ROIC) 1. Return on Invested Capital (ROIC) is a bit like Return on Equity; it is an attempt to understand the relationship between the earnings a company generates and its assets, so as to understand how efficient its assets are. ROIC, however, is a bit more of a refined measure, as it focuses on measuring profitability relative to investments the company has made in its operations (not other assets, like financial assets the company may hold for its own fiscal security). Mathematically, ROIC is calculated as follows: ROIC = (Earnings - Taxes) / (Book Value of Debt + Book Value of Equity - Cash and Cash Equivalents) 2. It is critical to note that ROIC is not a standard metric, and thus media that does calculate it for you may employ different methods of calculating it and thus there may not be consistency across sources. The calculation above is the one utilized by GuruFocus in its screener; some others utilize focus only on earnings from operations, which may be a more refined measure if one is looking to evaluate the business' income from operations in relation to its operational assets. 3. With that said, an ROIC of 10% is regarded as a benchmark of companies that may warrant further investigation. 4. On its surface, it may seem like companies with a high ROIC are great companies that are likely to outperform. However, there is some evidence to suggest that ROIC is mean reverting; meaning that companies with unusually high ROIC may not be able to sustain this, and that they may be participating in an industry that is overvalued and thus susceptible to some form of commoditization/price-based competition. However, the data on this is as murky, as it appears as though the top 4% of companies are able to maintain their position for lengthy periods of time. The charts presented in the corresponding video illustrate this. 5. A backtest conducted by OldSchoolValue found that a screen that incorporated ROIC had mixed results; in some instances, it outperformed the S&P 500, but in other instances, it did not. It should be noted we do not know what other factors were incorporated into the screen. I should note that I am not a big advocate of this indicator, and generally do not use it -- though I appreciate it conceptually.
Views: 3544 InformedTrades
IRR vs. Cash on Cash Multiples in Leveraged Buyouts and Investments
 
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In this IRR vs Cash tutorial, you’ll learn the key distinctions between the internal rate of return (IRR). By http://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" You will also learn further distinctions on the cash-on-cash multiple or money-on multiple when evaluating deals and investments – and you’ll understand why venture capital (VC) firms target one set of numbers, whereas private equity (PE) firms target a different set of numbers. http://youtube-breakingintowallstreet-com.s3.amazonaws.com/109-05-IRR-vs-Cash-on-Cash-Multiples.xlsx Table of Contents: 1:35 Why Do IRR and Cash-on-Cash Multiples Both Matter? 3:05 What Do Private Equity vs. Venture Capital vs. Other Firms Care About? 8:30 How to Use These Metrics in Real Life 11:08 Key Takeaways Lesson Outline: 1. Why Does This Matter? Because there are DIFFERENT ways to judge the success of a deal - 2 of the main ones for leveraged buyouts (LBOs), growth equity investments, and venture capital investments are the internal rate of return (IRR) and the cash-on-cash (CoC) or money-on-money (MoM) multiple. Many investment firms will care a lot about one of these, but not the other, and will try to find investments that yield a high IRR or a high multiple… but not both. The Difference: IRR factors in the time value of money - it's the effective, compounded interest rate on an investment. Whereas the multiple is simpler and ignores timing (e.g., $1000 / $100 = 10x multiple). 2. What Do Different Firms Care About? Most venture capital (VC) firms and early-stage investors want to earn a multiple of their money back - they don't care that much about IRR, because they're going to be invested for a VERY LONG time and it's not exactly liquid… and they don't care what the stock market does. VC firms must be able to cover their losses with “the winners”! If they get 2x their capital back in 1 year (100% IRR) and then lose everything on another investment in 5 years’ time (0% IRR), the first result is completely irrelevant because they've only earned back 1x their capital. Perfect Example: Harmonix, maker of Guitar Hero - got VC investment in the mid-1990's, generated $0 in revenue for 5+ years, and then in 2005 released the hit video game Guitar Hero. Sold for $175 million to Viacom in 2006! Massive multiple, but likely a pathetic IRR since it took 10+ years to get there. Later-stage investors and private equity firms care more about IRR because the multiples will never be that high in late-stage deals, and because they are benchmarked against the public markets (e.g., the S&P 500) more. If the firm's IRR can't beat the stock market, why should you invest? Most PE firms target at least a 20-25% IRR depending on the economy, deal environment, valuations, etc… less when things are bad, more in frothy times. This makes it common to do "quick flip" deals where the company is bought and then sold at a MUCH higher multiple right after - simply to get a high IRR. Real-Life Example: Thoma Bravo (mid-market tech PE firm) bought Digital Insight from Intuit for $1.025 billion, and then sold it 4 months later for $1.65 billion to NCR. VERY high IRR - 316%! But only a ~1.6x money multiple, assuming no debt / no debt repayment. http://dealbook.nytimes.com/2013/12/02/sale-to-ncr-is-a-quick-profitable-flip-for-a-private-equity-firm/ 3. How Do You Use These Metrics In Real Life? How to calculate them: see the Atlassian or J.Crew models. IRR is straightforward and uses built-in Excel functions, but for the CoC or MoM multiple, you need to sum up all positive cash flows in the period and divide by the sum of all negative cash flows in that period, and flip the sign. In the case of Atlassian, the deal is great for Accel because they earn a 15x multiple, even though the IRR is "only" 35%... they do not care AT ALL because they are targeting the multiple, not the IRR. For T. Rowe Price, the multiple of 1.9x isn't great, but they do at least get a 14% IRR which is probably what they care about more since they are late-stage investors. For the J. Crew deal, both the IRR and the multiple are very low and below what PE firms typically target, so this deal would be problematic to pursue, at least with these assumptions. 4. Key Takeaways IRR and Cash-on-Cash or Money-on-Money multiples are related, but often move in opposite directions when the time period changes. Different firms target different rates and metrics (VC/early stage - multiples, ideally over 10x or 3-5x later on; PE/late stage - IRR, ideally 20%+). Calculation: IRR is simple, use the built-in IRR or XIRR in Excel; for the multiple, sum the positive returns/cash flows, divide by the negative returns/cash flows and flip the sign. Judging deals: Focus on multiples for earlier stage deals (and if you're pitching VCs to fund your company), and focus on IRR for later stage / growth equity / PE deals.
Value Creation:  ROIC and Financial Cycle Time
 
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Professor Joe Perfetti defines the concept of Financial Cycle Time and shows its impact on the Return on Invested Capital (ROIC) of an organization.
Views: 6747 Percipient Partners
ROCE (Return on Capital Employed) - Explained in Hindi
 
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Return On Capital Employed is explained in hindi. ROCE is an important financial ratio that gives overall returns on the total capital employed in the business. But 6 different analysts may calculate ROCE in 6 different ways. Return on Invested Capital or ROIC is also a similar metric but Return on Capital Employed is more popular. Related Videos: Return on Investment (ROI): https://youtu.be/ij7y5e2MVG4 Return on Equity (ROE): https://youtu.be/K-OhdUGqdzc Return on Assets: https://youtu.be/7z9jDKNub6U Profitability Ratios: https://youtu.be/pHgiuO2ZYoU Financial Ratios & Analysis: https://youtu.be/CZscpOND3Vs रिटर्न ऑन कैपिटल एम्प्लॉयड को इस वीडियो में हिंदी समझाया गया है। ROCE एक बहुत ही महत्वपूर्ण फाइनेंसियल रेश्यो है जो की बिज़नेस में लगाए गए टोटल कैपिटल पर ओवरआल रिटर्न्स बताता है। लेकिन 6 अलग-अलग अनलिस्ट्स 6 अलग-अलग तरीकों से आरओसीई की कैलकुलेशन कर सकते हैं। रिटर्न ऑन इनवेस्टेड कैपिटल या ROIC भी एक सिमिलर मीट्रिक है लेकिन रिटर्न ऑन कैपिटल एम्प्लॉयड ज़्यादा पॉपुलर है। Share this Video: https://youtu.be/FjWuma0U2x0 Subscribe To Our Channel and Get More Property, Real Estate and Finance Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is the return on capital employed? What is the full form of ROCE? What is return on sales? How to calculate the returns using return on capital employed formula? Why is ROCE an important finance ratio? In this video about return on capital employed, we will understand the definition, calculation using an example. It's a useful metric for comparing the relative profitability of companies using the amount of total capital. But whenever you calculate ROCE for any company it is really important to stick to one calculation method to compare the statics with other companies. Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Twitter - http://twitter.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Linkedin - http://www.linkedin.com/company/asset-yogi Instagram - http://instagram.com/assetyogi Facebook – https://www.facebook.com/assetyogi Google Plus – https://plus.google.com/+assetyogi-ay Hope you liked this video in Hindi on “ROCE (Return on Capital Employed)”.
Views: 10368 Asset Yogi
How to calculate Return on Equity
 
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Here’s an important question to ask about any investment you’re making: “Is this the best use of my money?” Hi everybody, Ron Phillips here with RPC Invest. https://www.rpcinvest.com/ Like us on Facebook: https://www.facebook.com/WealthAcceleratorSystem/ Blog Post: https://www.rpcinvest.com/blog Don’t forget to Comment and Subscribe if you liked this video! Thanks for checking out this video! A Question i get asked all the time is…. Why should i invest into Real Estate. http://www.ron-phillips.com/3xmarket/ The answer that your will video out if you check out in this video http://vimeo.com/99046951 is that rental properties are not only a great investment if you do it right! They can become a passive income that your can replace your current income with or stay at your day job and build your wealth on the side for an early retirement! With my FREE Wealth Accelerator System you will learn how to Double your Retirement in 45 days or Less! Watch Ron's new webinar here: https://goo.gl/KAd85k Not only will i teach you the RIGHT kind of property to look for, but i’ll also teach you how to create a positive cash flow. With our wealth plan we look at your net worth and set a goal to INCREASE net worth before retirement! You can click this link https://www.rpcinvest.com/weathplan and your current financial situation and set your financial goals and see how your net worth can grow using REAL investment properties! My main goal when i started this was to create a system that would give you FINANCIAL FREEDOM through an investment that gives you double digit returns. https://goo.gl/1MrD7G I don’t charge you a dime to learn this my system! We will help you find the right homes to start growing your WEALTH!
Views: 23061 InvestmentPropCoach
Return on Equity (ROE) - Explained in Hindi
 
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Return on Equity is explained in hindi. ROE is a profitability financial ratio that gives the return on investment for shareholders. In next video we will learn about ROCE i.e. Return on Capital Employed that gives overall returns on the capital in the business. Related Videos: Financial Ratios & Analysis: https://youtu.be/CZscpOND3Vs Profitability Ratios: https://youtu.be/pHgiuO2ZYoU Return on Investment (ROI): https://youtu.be/ij7y5e2MVG4 ROCE (Return on Capital Employed): https://youtu.be/FjWuma0U2x0 Return on Assets: https://youtu.be/7z9jDKNub6U रिटर्न ऑन इक्विटी को इस वीडियो में हिंदी में एक्सप्लेन किया गया है। ROE एक प्रोफिटेबिलिटी फाइनेंसियल रेश्यो है जो शेयर होल्डर्स के लिए निवेश पर रिटर्न देता है। अगले वीडियो में हम ROCE यानिकि रिटर्न ऑन कैपिटल एम्प्लॉयड के बारे में जानेंगे जो की बिज़नेस के कैपिटल पर ओवरऑल रिटर्न देता है। Share this Video: https://youtu.be/K-OhdUGqdzc Subscribe To Our Channel and Get More Property, Real Estate and Finance Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is a return on equity or ROE? How many types of ROE is there? How to calculate returns using return on equity formula? What are the limitations of return on equity calculation? What is the common equity? What is the meaning of preferred equity? Which profitability ratio is used to calculate the return on investment for shareholders? How to calculate the return on common equity? What happens when the company increases debt & decreases the equity portion? In the video, you will also see how you can check the financials of different companies online & calculate the return on equity. Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Instagram - http://instagram.com/assetyogi Google Plus – https://plus.google.com/+assetyogi-ay Facebook – https://www.facebook.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Twitter - http://twitter.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Hope you liked this video in Hindi on “Return on Equity (ROE)”.
Views: 11769 Asset Yogi
How to Calculate ROI (Return On Investment) in Excel
 
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How to calculate ROI in Excel using formula. dollar return on investment excel spreadsheet, how to calculate roi in excel percentage Excel File: http://www.uploadkr.com/users/wajahat/ROI_20.xlsx If you have any question please feel free to ask. Don't forget to SUBSCRIBE Source: investopedia.com How to Calculate ROI ROI Calculation in Excel ROI Calculation - Made easy How to calculate Return on Investment roi calculation in excel how to calculate roi in excel how to calculate return on investment in excel calculating return on investment in excel how to calculate training roi in excel measure roi in excel
Views: 32158 InnoRative
How To Calculate Return On Investment Calculation (ROI) | Return On Capital Employed (finance) Yield
 
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Knowing how to calculate return on investment calculation (ROI), also known as return on capital employed, is essential for property investment uk based investors and I'd suggest it's better than Yield. ROI tells you how hard your finances are working for you and whether you're making a profit. This analysis is a great way to compare the returns between different investment properties and will certainly help you with your investing. DOWNLOAD FREE CHECKLIST... https://yourfirstfourhouses.com/ Can that now you know this equation - why not pick 5 buy to let uk based properties off of Rightmove and try to calculate their return on investment. Learning how to calculate return on investment is an essential skill in your property business and the sooner you learn it, the sooner you can start finding better investment property deals. I hope you find this one helpful. All the best... Tony Law | Your First Four Houses
Return on equity | Tamil | Value investing
 
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In this video I am telling about return on equity of stock (ROE) in share market in Tamil. Also, I am sharing my knowledge to all through this to our Tamil community. Everyone can share your thought through this and help others by sharing videos. My other videos are, Other videos of my channel is, • Book value - • Dividend, • PE Ratio • Industry PE Ratio • Sector PE Ratio • Investment ideas • Trading ideas • Share investment • Dividend yield, • Face value, • Premium value, • Tamil, • Investment factors in tamil, • Fundamental analysis, • Share | stock market in tamil, • Stock | share analysis • Jargon of stock | share market • மறை நீர் (Virtual water) • Budget impact on stock market • IPO • Promotors • Candle Stick • Fundamental vs Technical analysis of stock • Why share price going down even fundamental is strong - https://youtu.be/CJlhFg0UCp0 • EBITDA • PB Ratio • ROE
Views: 618 Viyan Tamil
Investopedia Video: How To Calculate Return On Investment (ROI)
 
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Be the first to check out our latest videos on Investopedia Video: http://www.investopedia.com/video/ Return on investment allows an investor to evaluate the performance of an investment and compare it to others in his or her portfolio. Find out how to calculate ROI and how to use to your advantage. For more on different ROI ratios, and how to use them -- check out; FYI On ROI: A Guide To Calculating Return On Investment http://www.investopedia.com/articles/basics/10/guide-to-calculating-roi.asp How To Calculate ROI For Real Estate Investments http://www.investopedia.com/articles/basics/11/calculate-roi-real-estate-investments.asp Find Quality Investments With ROIC http://www.investopedia.com/articles/fundamental/03/050603.asp CFA Level 1 Exam Prep: Financial Ratios - Return On Investment Ratios http://www.investopedia.com/exam-guide/cfa-level-1/financial-ratios/return-investment-ratios.asp
Views: 153076 Investopedia
NPV and IRR explained
 
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Net Present Value and Internal Rate of Return, in short NPV and IRR. What is the purpose of the NPV and IRR methods of investment analysis, and how do you calculate NPV and IRR? The main idea of Net Present Value is very simple: time is money! The net present value (or “discounted cash flow”) method takes the time value of money into account, by: - Translating all future cash flows into today’s money - Adding up today’s investment and the present values of all future cash flows If the net present value of a project is positive, then it is worth pursuing, as it creates value for the company. IRR is the discount rate at which the net present value becomes 0. In other words, you solve for IRR by setting NPV at 0. Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Payback Period | Accounting Rate of Return | Managerial Accounting | CMA exam | Ch 26 p 2
 
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CPA BEC questions, capital budgeting, net present value, NPV, IRR, INternal rate of return, return on investment, return, IRR, payback period, cost of capital, simple rate of return, accounting rate of return
Return On Invested Capital
 
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An Easy Overview Of Return On Invested Capital
Views: 1427 Christopher Hunt

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