.DuPont Analysis: Decomposition of ROE
Difficulty: Beginner
Decomposing ROE involves expressing net income divided by shareholders' equity as the product of component ratios.
Two-Component Disaggregation of ROE
Chevron Corp., decomposition of ROE
| | | | |||
| ROE | = | ROA | × | Leverage | |
|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||
| Dec 31, 2016 | % | % | |||
| Dec 31, 2015 | % | % | |||
| Dec 31, 2014 | % | % | |||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
Three-Component Disaggregation of ROE
Chevron Corp., decomposition of ROE
| | | | | ||||
| ROE | = | Net Profit Margin | × | Asset Turnover | × | Leverage | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||||
| Dec 31, 2016 | % | % | |||||
| Dec 31, 2015 | % | % | |||||
| Dec 31, 2014 | % | % | |||||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
Five-Component Disaggregation of ROE
Chevron Corp., decomposition of ROE
| | | | | | | ||||||
| ROE | = | Tax Burden | × | Interest Burden | × | EBIT Margin | × | Asset Turnover | × | Leverage | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||||||||
| Dec 31, 2016 | % | % | |||||||||
| Dec 31, 2015 | % | % | |||||||||
| Dec 31, 2014 | % | % | |||||||||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
Two-Way Decomposition of ROA
Chevron Corp., decomposition of ROA
| | | | |||
| ROA | = | Net Profit Margin | × | Asset Turnover | |
|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||
| Dec 31, 2016 | % | % | |||
| Dec 31, 2015 | % | % | |||
| Dec 31, 2014 | % | % | |||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
Four-Way Decomposition of ROA
Chevron Corp., decomposition of ROA
| | | | | | |||||
| ROA | = | Tax Burden | × | Interest Burden | × | EBIT Margin | × | Asset Turnover | |
|---|---|---|---|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||||||
| Dec 31, 2016 | % | % | |||||||
| Dec 31, 2015 | % | % | |||||||
| Dec 31, 2014 | % | % | |||||||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
Decomposition of Net Profit Margin
Chevron Corp., decomposition of Net Profit Margin
| | | | | ||||
| Net Profit Margin | = | Tax Burden | × | Interest Burden | × | EBIT Margin | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2017 | % | % | |||||
| Dec 31, 2016 | % | % | |||||
| Dec 31, 2015 | % | % | |||||
| Dec 31, 2014 | % | % | |||||
| Dec 31, 2013 | % | % |
Source: Based on data from Chevron Corp. Annual Reports
