📊 DuPont Analysis Calculator

ROE Decomposition · Net Margin · Asset Turnover · Equity Multiplier
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📥 Input Financial Data
🔬 Scenario Analysis
📊 Industry Benchmark
Tech: ROE 15‑25% | Margin 10‑20% | Turnover 0.8‑1.5 | Leverage 1.5‑2.5
Return on Equity (ROE)
12.50%
Net Profit Margin
10.0%
Asset Turnover
1.25x
Equity Multiplier
2.00x
ROE is primarily driven by financial leverage.
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📘 What is DuPont Analysis?

DuPont analysis decomposes Return on Equity (ROE) into three components: net profit margin, asset turnover, and equity multiplier. This helps identify whether a company's ROE is driven by operational efficiency, asset use, or financial leverage.

❓ Frequently Asked Questions

How is ROE calculated in DuPont analysis?

ROE = Net Profit Margin × Asset Turnover × Equity Multiplier. Net Margin = Net Income / Revenue; Turnover = Revenue / Assets; Multiplier = Assets / Equity.

What does a high equity multiplier indicate?

A high multiplier means the company relies more on debt financing. While it can boost ROE, it also increases financial risk.

How can I improve ROE?

Improve profit margins (cut costs/raise prices), increase asset turnover (generate more sales per dollar of assets), or optimize capital structure (adjust leverage).

Why is DuPont analysis useful?

It reveals the underlying drivers of ROE, helping managers and investors pinpoint strengths and weaknesses in a company's financial performance.