NVDA ROE - Return on Equity
Profitability analysis for Nvidia Corp
Stock Price
$185.58
+0.31% today
Return on Equity (ROE)
115.4%
Excellent - Outstanding capital efficiency
Key Profitability Metrics
Return on Equity
115.4%
Profit per dollar of equity
Return on Assets
78.8%
Profit per dollar of assets
Return on Invested Capital
116.1%
Profit per dollar invested
Industry Comparison
NVDA ROE
115.4%
Information Technology Average
12.0%
Difference
+103.4%
Above industry by 861.7%
NVDA is outperforming Information Technology peers with superior capital efficiency and profitability.
DuPont Analysis - ROE Breakdown
ROE can be decomposed into three components using the DuPont formula:
ROE = Net Margin × Asset Turnover × Equity Multiplier
Net Profit Margin
55.8%
Strong pricing power
Asset Turnover
1.41x
Efficient asset use
Equity Multiplier
0.00x
Conservative
115.4% = 55.8% × 1.41 × 0.00
What ROE Means for Investors
Capital Efficiency
NVDA's high ROE of 115.4% indicates excellent capital efficiency. Management is generating strong returns on shareholder investments.
Competitive Advantage
Consistently high ROE above industry peers suggests Nvidia Corp has durable competitive advantages like brand strength, pricing power, or operational excellence.
Growth Potential
High ROE companies can fund growth internally by reinvesting profits. NVDA may not need to raise external capital for expansion, which is investor-friendly.
Leverage Consideration
NVDA has conservative leverage (0.0x equity multiplier), suggesting the ROE reflects genuine operational efficiency rather than financial engineering.
ROE Calculation Data
Most Recent Quarter
Net Income
$$72.88B
Shareholders Equity
$0.00B
Formula
ROE = (Net Income / Shareholders Equity) × 100
Analyze NVDA in Depth
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Frequently Asked Questions
What is NVDA ROE (Return on Equity)?
NVDA's Return on Equity (ROE) is 115.4%, which is considered excellent. ROE measures how efficiently Nvidia Corp generates profit from shareholders' equity. For every dollar of equity, NVDA generates 115.4 cents in profit.
Is NVDA ROE good or bad?
NVDA's ROE of 115.4% is excellent and above the Information Technology average of approximately 12.0%. Outstanding capital efficiency. NVDA is outperforming peers by 861.7%.
What is the difference between ROE, ROA, and ROIC?
ROE (Return on Equity) at 115.4% measures returns on shareholder equity. ROA (Return on Assets) at 78.8% measures how efficiently NVDA uses its total assets. ROIC (Return on Invested Capital) at 116.1% shows returns on all capital invested, including debt. All three metrics help evaluate Nvidia Corp's profitability from different angles.
How does NVDA generate its ROE?
NVDA generates its 115.4% ROE through the DuPont formula: Net Margin (55.8%) × Asset Turnover (1.41) × Equity Multiplier (0.00). This shows strong pricing power and cost control, efficient asset utilization, and conservative capital structure.
Should I invest in NVDA based on ROE?
While NVDA's ROE of 115.4% is excellent, ROE alone shouldn't determine investment decisions. High ROE can indicate competitive advantages and efficient management. Consider ROE alongside other metrics like debt levels, growth rates, valuation multiples, and industry trends before investing.
What factors affect NVDA Return on Equity?
NVDA's ROE is affected by three key drivers: (1) Profitability - net margins from pricing power and cost management, (2) Efficiency - how well Nvidia Corp uses its assets to generate sales, and (3) Leverage - the amount of debt used to finance operations. Information Technology sector dynamics, competitive positioning, management quality, and economic conditions all impact these drivers.
Disclaimer: ROE analysis is based on publicly available financial data and should not be considered financial advice. High ROE can be misleading if driven primarily by excessive leverage. Always analyze multiple metrics and consider your own research before making investment decisions.