How Did Portland General Electric Company's (NYSE:POR) 9.4% ROE Fare Against The Industry?

Simply Wall St.12-09

While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to ...

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We'll use ROE to ...</p>\n\n<a href=\"https://finance.yahoo.com/news/did-portland-general-electric-companys-101647159.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4081","symbol_name":"电力公用事业","start_time":0,"source_url":"https://finance.yahoo.com/news/did-portland-general-electric-companys-101647159.html","article_id":"2490474798","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/vufsA66WUrIdn1cTA_PBdw--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/8825248dd2026431674a1820f2d9889e"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2490474798","pubTimestamp":1733739407,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"While some investors are already well versed in financial metrics , this article is for those who would like to learn about Return On Equity  and why it is important. We'll use ROE to examine Portland General Electric Company , by way of a worked example.Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. In simpler terms, it measures the profitability of a company in relation to shareholder's equity.See our latest analysis for Portland General Electric. Return on Equity = Net Profit  ÷ Shareholders' Equity. So, based on the above formula, the ROE for Portland General Electric is:. Does Portland General Electric Have A Good Return On Equity?Combining Portland General Electric's Debt And Its 9.4% Return On Equity","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4081":"电力公用事业","BK4501":"段永平概念","LU2264538146.SGD":"Fullerton Lux Funds - Global Absolute Alpha A Acc SGD","LU2756315664.SGD":"ALLIANZ INCOME AND GROWTH \"AMI\" (SGDHDG) INC","BK4588":"碎股","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","LU0868494617.USD":"UBS (LUX) EQUITY SICAV - US TOTAL YIELD SUSTAINABLE \"P\" (USD) ACC","LU0157215616.USD":"FIDELITY GLOBAL FOCUS \"A\" INC","NYSE":"纽交所","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","LU1064131342.USD":"Fullerton Lux Funds - Global Absolute Alpha A Acc USD","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","LU0149725797.USD":"汇丰美国股市经济规模基金","LU0354030511.USD":"ALLSPRING  U.S. LARGE CAP GROWTH \"I\" (USD) ACC","LU1366333091.USD":"FIDELITY GLOBAL FOCUS \"A\" (USD) ACC","LU0354030438.USD":"富国美国大盘成长基金Cl A Acc","LU2756315318.SGD":"ALLIANZ INCOME AND GROWTH \"AMG\" (SGDHDG) INC A","LU1093756168.USD":"FRANKLIN K2 ALTERNATIVE STRATEGIES \"A\" (USD) ACC","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","ROE":"ASTORIA US QUALITY KINGS ETF","GE":"GE航空航天","BK4187":"航天航空与国防","LU1988902786.USD":"FULLERTON LUX FUNDS GLOBAL ABSOLUTE ALPHA \"I\" (USD) ACC","LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD","BK4585":"ETF&股票定投概念","LU1093756325.SGD":"FTIF - Franklin K2 Alt Strat Fd A (acc) SGD-H1","LU0640476718.USD":"THREADNEEDLE (LUX) US CONTRARIAN CORE EQ \"AU\" (USD) ACC","POR":"波特兰通用电气","LU1280957306.USD":"THREADNEEDLE (LUX) US CONTRARIAN CORE EQUITIES \"AUP\" (USD) INC","BK4566":"资本集团","LU1261432733.SGD":"Fidelity World A-ACC-SGD","LU0820561909.HKD":"ALLIANZ INCOME AND GROWTH \"AM\" (HKD) INC","BK4206":"工业集团企业","LU0820562030.AUD":"ALLIANZ INCOME AND GROWTH \"AMH2\" (AUDHDG) H2 INC"},"translate_title":"波特兰通用电气公司(NYSE：POR)9.4%的ROE与行业相比表现如何？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ROE":1,"POR":1,"NYSE":1,"GE":1},"content_text":"While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to examine Portland General Electric Company (NYSE:POR), by way of a worked example. \n Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. In simpler terms, it measures the profitability of a company in relation to shareholder's equity. \n See our latest analysis for Portland General Electric \n How To Calculate Return On Equity? \n Return on equity can be calculated by using the formula: \n Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity \nSo, based on the above formula, the ROE for Portland General Electric is:\n9.4% = US$343m ÷ US$3.6b (Based on the trailing twelve months to September 2024).\n The 'return' is the income the business earned over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.09 in profit. \n Does Portland General Electric Have A Good Return On Equity? \n One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. The image below shows that Portland General Electric has an ROE that is roughly in line with the Electric Utilities industry average (9.3%). \n\n\n\n  NYSE:POR Return on Equity December 9th 2024\n \n\n So while the ROE is not exceptional, at least its acceptable. Even if the ROE is respectable when compared to the industry, its worth checking if the firm's ROE is being aided by high debt levels. If a company takes on too much debt, it is at higher risk of defaulting on interest payments. You can see the 3 risks we have identified for Portland General Electric by visiting our risks dashboard for free  on our platform here. \n The Importance Of Debt To Return On Equity \n Virtually all companies need money to invest in the business, to grow profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. \n Combining Portland General Electric's Debt And Its 9.4% Return On Equity \n It's worth noting the high use of debt by Portland General Electric, leading to its debt to equity ratio of 1.22. Its ROE is quite low, even with the use of significant debt; that's not a good result, in our opinion. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it. \n Summary \n Return on equity is one way we can compare its business quality of different companies. In our books, the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE. \n But when a business is high quality, the market often bids it up to a price that reflects this. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to check this FREE visualization of analyst forecasts for the company. \n Of course Portland General Electric may not be the best stock to buy. So you may wish to see this free collection of other companies that have high ROE and low debt. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2490474798"}