HOODNEUTRAL

HOOD Return on Equity (ROE) Analysis

23.6%

Updated 107h ago·SEC filings & market data

Key Takeaway

Return on Equity (ROE) measures how efficiently a company generates profit from every dollar of shareholders' equity—21.5% means HOOD earns $0.215 for each $1 of equity.

Sector Performance

75th percentile

HOOD

23.6%

Sector Median

13.3%

Sector Avg

17.0%

Prior Period

21.5%(Jul 2026)

↑ Improving

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Deep Analysis

Return on Equity (ROE) measures how efficiently a company generates profit from every dollar of shareholders' equity—21.5% means HOOD earns $0.215 for each $1 of equity.

This is above the sector median of 13.8%, placing HOOD in the 69th percentile among its peers. Trend data is limited: year-over-year change is not available, and the eight-quarter trend direction is also not available; however, quarter-over-quarter ROE rose by +4.4% from 20.6% to 21.5%. The combination of a high ROE level and a recent upward move suggests lower relative risk or a potential opportunity, but the lack of a longer track record tempers that view. Overall, this metric supports the NEUTRAL verdict—the strong profitability reading is a positive, but it does not outweigh the other factors that keep the stock's rating balanced.

Frequently Asked Questions

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

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.

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

The closest peers by Return on Equity (ROE) include: EVGO (-34.6%), MAR (-69.0%), BMBL (-76.9%), WBA (-82.7%), NIO (-84.0%).

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Learn More About Return on Equity (ROE)

What Is Return on Equity (ROE) and Is Higher Always Better?

Return on equity ROE measures how efficiently a company generates profit from shareholder capital. Learn how to decompose ROE using DuPont analysis and why high leverage can make it dangerous—with Apple and JPMorgan examples.

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.