BABANEUTRAL

Return on Equity (ROE)

9.2%

Higher than 52% of Consumer Cyclical sector peers

Updated 49h ago

Sector Performance

52th percentile

BABA

9.2%

Sector Median

8.6%

Sector Avg

-38.7%

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Deep Analysis

Return on Equity (ROE) measures how efficiently a company generates profit from its shareholders’ equity—a 9.2% ROE means BABA earns $0.092 for every dollar of equity invested.

This sits just above the Consumer Cyclical sector median of 8.6%, placing BABA in the 52nd percentile among its peers, slightly above average but not a standout. The eight-quarter trend direction is increasing, but the most recent quarter-over-quarter change is -6.1% (from 9.8% to 9.2%), while year-over-year change is not available. Although the long-term trend is upward, the recent quarterly decline suggests near-term pressure on profitability relative to equity. The combination of a near-median ROE with a fading quarterly trend points to moderate risk—no clear edge for either outperformance or deterioration. This metric neither strongly supports nor contradicts the NEUTRAL verdict; the ROE is average and the trend is mixed, aligning with a neutral stance.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about BABA?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does BABA's Return on Equity (ROE) compare to its sector?

BABA's Return on Equity (ROE) of 9.2% compares to a Consumer Cyclical sector median of 8.6%, placing it in the 52th percentile.

Who are BABA's closest peers by Return on Equity (ROE)?

The closest Consumer Cyclical peers by Return on Equity (ROE) include: JD (6.0%), TSLA (4.9%), CZR (-10.7%), RL (34.7%), YUM (-21.3%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.