Posted 11/27/2015 18:13 (#4922865 - in reply to #4922001) Subject: RE: Return on equity as a farming operation matures
SE IA
Return on Equity seems like a pointless calculation.
Since I assume ROE is figured by return/Equity the lower equity farmer is always going to show a higher ROE vs a well established high equity position.
ROI seems like a much better figure to understand profitability. If a guy rents high rent land and makes $15/acre while investing $800/ acre for inputs is showing a pretty worthless return on the cash he laid out. A guy making $100/acre while forking over $800 for inputs is showing a much better use of his cash outlays than the guy working on razor thin margins.
What am I missing on why return on equity is important?
Return on equity as a farming operation matures
