Return on net assets
The return on net assets (RONA) is a measure of financial performance of a company which takes the use of assets into account.[1][2] Higher RONA means that the company is using its assets and working capital efficiently and effectively.[3] RONA is used by investors to determine how well management is utilizing assets.[4]
Basic formulae
- Return on net assets = net income/ (Fixed assets) + (working capital)
where
- Working capital = (current assets) − (current liabilities)[5]
In a manufacturing sector, this is also calculated as:
- Return on net assets = (plant revenue) − costs/ (net assets)
See also
- Financial ratio
References
- ^ "Innovation outposts and the evolution of corporate R&D". The Berkeley Blog. 2015-12-22. Retrieved 2018-01-19.
- ^ "Report Highlights Financial Resilience of Small and Mid-Sized Private Institutions". The Council of Independent Colleges. Retrieved 2018-01-19.
- ^ Return on Net Assets (RONA)
- ^ root (2003-11-26). "Return On Net Assets - RONA". Investopedia. Retrieved 2016-10-10.
- ^ "Intro and Financial Analysis". www.ualr.edu. Retrieved 2018-01-19.
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Financial ratios
- Buffett indicator
- Cyclically adjusted price-to-earnings (CAPE)
- Capitalization rate (Cap Rate)
- Cash return on cash invested (CROCI)
- Debt-to-equity (D/E)
- Dividend cover
- Dividend payout
- Earnings yield (E/P)
- Enterprise value/EBITDA (EV/EBITDA)
- Enterprise value/gross cash invested (EV/GCI)
- Enterprise value/sales (EV/Sales)
- Loan-to-value (LTV)
- Omega
- Operating margin
- Price-to-book (P/B)
- Present value of growth opportunities (PVGO)
- Price/cash flow (P/CF)
- Price-earnings (P/E)
- Price-earnings to growth (PEG)
- Price-sales (P/S)
- Profit margin
- Return on assets (ROA)
- Return on net assets (RONA)
- Return on capital (ROC)
- Return on capital employed (ROCE)
- Return on equity (ROE)
- Return on tangible equity (ROTE)
- Risk-adjusted return on capital (RAROC)
- Risk return (RRR)
- Sharpe
- Short interest (SIR)
- Sortino
- Sustainable growth (SGR)
- Treynor
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