Return On Retained Earnings - RORE

AAA

DEFINITION of 'Return On Retained Earnings - RORE'

A calculation to show how well the profits of the previous year were reinvested. RORE is expressed as a percentage. A high percentage would indicate that a company would be better off reinvesting into the business, whereas a low one would show that paying out dividends may be in the best interests of the company.

INVESTOPEDIA EXPLAINS 'Return On Retained Earnings - RORE'

As an investor, it can often be difficult to quantify a company's worth by simply looking at its balance sheet. A RORE calculation can help to alleviate some of the confusion and help clarify exactly what the numbers are trying to say. A general rule of thumb for investors is to look for companies with high RORE that is reinvested regularly.

RELATED TERMS
  1. Unappropriated Retained Earnings

    Any portion of company earnings that are not classified as appropriated ...
  2. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  3. Retained Earnings

    The percentage of net earnings not paid out as dividends, but ...
  4. Profit

    A financial benefit that is realized when the amount of revenue ...
  5. Dividend

    1. A distribution of a portion of a company's earnings, decided ...
  6. Rights of Accumulation - ROA

    A right that allows a shareholder to receive reduced sales charges ...
Related Articles
  1. How To Calculate A Z-Score
    Markets

    How To Calculate A Z-Score

  2. Evaluating Retained Earnings: What Gets ...
    Fundamental Analysis

    Evaluating Retained Earnings: What Gets ...

  3. Find Quality Investments With ROIC
    Options & Futures

    Find Quality Investments With ROIC

  4. Use ROA To Gauge A Company's Profits
    Budgeting

    Use ROA To Gauge A Company's Profits

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center