One of Warren Buffetts acquisition criteria is to invest in businesses earning good return on equity. The

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One of Warren Buffett’s acquisition criteria is to invest in businesses “earning good return on equity.”

The ROE formula uses both net income and stockholders’ equity. Why is it important to relate net income to stockholders’ equity? Why isn’t it sufficient to merely concentrate on companies with the highest net income?

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Financial Statement Analysis And Valuation

ISBN: 9781618532336

5th Edition

Authors: Peter D. Easton, Mary Lea McAnally, Gregory A. Sommers

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Question Posted: Oct 25, 2024 04:02 AM

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One of Warren Buffetts acquisition criteria is to invest in businesses earning good return on equity. The

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Financial Statement Analysis And Valuation

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