return on common equity
Definition
ROCE. A variation of the Return on Equity formula which subtracts preferred dividends from net income and preferred equity from shareholders' equity. This variation shows the effect of common shares on profitability. Its formula is (Net income - preferred dividends)/(shareholders' equity - preferred equity).
Use this term in a sentence
“ You should try and figure out the best way to increase your return on common equity so that you can earn the most. ”
“ The return on common equity was really cool and I was glad that everything was going well for it and it was not being disrupted. ”
“ They calculated the return on common equity and took a look at their common shares outstanding. Before issuing more stock, they wanted to understand the current impact on the bottom line. ”
