GOOGLBULLISH

Return on Equity (ROE)

38.9%

Higher than 89% of Communication Services sector peers

Updated 168h ago

Sector Performance

89th percentile

GOOGL

38.9%

Sector Median

11.0%

Sector Avg

14.7%

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Deep Analysis

Return on Equity (ROE) measures how much profit a company generates from each dollar of shareholders’ equity — a 38.9% ROE means Alphabet earns roughly $0.39 for every $1 of equity.

This is well above the Communication Services sector median of 11.0%, placing Alphabet in the 89th percentile among peers. The year-over-year change is not available, but quarter-over-quarter ROE rose by 22.3%, from 31.8% to 38.9%. A high and quickly improving ROE suggests Alphabet is using its capital more efficiently than most competitors, which typically lowers investment risk. This combination of an already strong level and a sharp upward trend points to a favorable opportunity for investors. The metric directly supports the overall BULLISH verdict, as such elevated and rising profitability aligns with a positive outlook on the stock.

Frequently Asked Questions

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

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 GOOGL's Return on Equity (ROE) compare to its sector?

GOOGL's Return on Equity (ROE) of 38.9% compares to a Communication Services sector median of 11.0%, placing it in the 89th percentile.

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

The closest Communication Services peers by Return on Equity (ROE) include: DIS (11.0%), DASH (9.9%), PINS (8.9%), NYT (16.9%), T (18.4%).

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.