Return On Assets Managed - ROAM
Definition of 'Return On Assets Managed - ROAM'A measure of profits shown as a percentage of the capital that is handled. Return on assets managed is calculated by taking operating profits and dividing it by assets (which could include accounts receivable and inventory). Asset turnover and operating margin are the two main drivers in returns on assets managed. |
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Investopedia explains 'Return On Assets Managed - ROAM'Changes in this measure from year to year show a company's changing ability to generate profit on the assets under its control. Another way to calculate this return is: Asset turnover multiplied by operating profit margin. Some analysts use return on net assets managed, and others use return on total operating assets managed. It is important not to use one metric or variation to compare all companies. |
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