Return On Revenue (ROR)

Return On Revenue (ROR) is a measure of a corporation's profitability.  Return On Revenue is also known as Net Profit Margin. Return On Revenue can alert investors to rising expenses when a decrease in return on revenue is observed.

Return On Revenue (ROR)

Return On Revenue (ROR) is a measure of a corporation's profitability.  Return On Revenue is also known as Net Profit Margin.

 


Calculation of ROR

Return On Revenue formula:  ROI = Net Income / Revenue

Return On Revenue Interpretation

Return On Revenue can alert investors to rising expenses when a decrease in return on revenue is observed. An increase in the ROR is an indication that the expenses of the company are being facilitated efficiently.



This ratio should be used in conjunction with other financial ratio to see the full picture of a company financial performance and financial position. The ROR tells only about the financial performance of a company and does not tell anything about the financial position of a company because it does not take into account the assets and liabilities of a company.

 

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