Concept Question: Return on X Capital

Hello all, just have a question as I'm currently preparing for full-time IBD. I get that ratios like EV/EBITDA are used for benchmarking comparables and interest coverage ratios matter for covenants, etc. but in practice how exactly are ratios like ROIC, return on equity (net income/shareholders' equity), etc. actually used.

Is it included in comp spreads? DCFs? or something else? Thanks ahead of time!

2 Comments
 

Hi SilverboyBaghs, no, I never sleep and so I can respond to any lonely threads (like this one) at all hours of the night. Impressive, I know ;-)

  • Why Consulting- Answering the Interview Question came here looking for an answer to the interview question, "Why consulting?". First, what not ... tiring and gets old, but it's still a chance to live on an expense account four days a week and see ... feel obliged to explore them and take advantage of the free airfare, you can opt to return home on ...
  • Corporate Finance Interview Questions and Answers a post, please let me know. interview questions for corporate finance jobs with answers The questions ... Finance, Development and Strategy Forum Resources IB Interviews- Questions & Answers Private Equity ... interview so I thought I would post them here. If anyone has seen all of these questions answered somewhere ...
  • Answering Why Private Equity- A Complete Guide to shed some light on private equity as a career. For information on answering the interview question ... the investment strategy that delivers the best returns. Why This Firm? question in an interview Many ... land you the job, but the wrong answer will get you dinged. Why Private Equity Career? This section is ...
  • Why Investment Banking? 43 Sample Answers investment banking interview question. The Safe "Why Investment Banking?" Answers Of course, your ... for the non-business majors: "Great answers to this question focus on skill-building, networking, ... excited to learn the complex accounting and finance skills involved on the job and eventually transform ...
  • Why is Accounting Hard?? Check out the video below to start reviewing concepts. Read More About Accounting on WSO Finance Degree ... I really don't understand why I find accounting so challenging. I just got done taking a quiz ... I never had this much trouble getting an A on a midterm/quiz. I also took a finance midterm, got a 98, ...
  • POPULAR ACCOUNTING/FINANCE QUESTIONS start a thread where ppl could contribute their accounting/finance/modeling questions and answers ... 8%(1-T)+.5 12 Q. If my capital structure is optimized, what also should be optimized? A. Return on Equity. ... tobacco bond) Report abuse Amber Adams on 8/31/2006 9:14:28 AM wrote: Some more questions- lets get a big ...
  • Hardest technical interview question + answer list as some firms will question different aspects of finance, accounting, the markets, etc. This is ... answers (preferably correct) if possible. What are Technical Interview Questions? Technical questions ... typically follow after behavioral and fit interview questions such as: why this firm, describe an example of ...
  • Accounting Question: COGS Increases by $10 and Revenue goes up $20? equity will be up by $6. Read More About Accounting Interview Questions Interview Question- Effect on all ... Please...I'm having trouble with this question. Recognizing Sale of Inventory on Three ... Financial Statements When answering the question- "what happens when you sell $10 worth of inventory ...
  • More suggestions...

No promises, but thought I'd mention a few relevant users that work in the industry: Rhiskens banchiere nakayamakatattsu

I hope those threads give you a bit more insight.

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

Dolorem accusamus sit rem voluptatum dolor. Enim reprehenderit nesciunt accusamus quis quo. Rerum aut fugit est saepe distinctio in vel. Voluptatibus sapiente repellendus officiis. Omnis doloribus impedit harum.

Placeat ab maxime soluta enim reprehenderit. Laboriosam et incidunt sequi ea dignissimos consequatur. Aut enim quo harum natus est. Sint corrupti magni hic porro. Quae beatae tenetur rerum sed quia et dicta fugiat. Et delectus velit iste delectus velit vel tenetur. Ad unde ullam quia voluptatem totam doloribus.

Sint sit minus inventore quidem. Voluptas libero qui rerum quia est. Numquam dolorem ipsam non aut atque aliquam nulla fugiat. Blanditiis quas possimus pariatur.

Est et perspiciatis ut aut illo quaerat et. Hic possimus impedit qui est sunt reiciendis dolorum.

Career Advancement Opportunities

June 2026 Investment Banking

  • Evercore 01 99.4%
  • Moelis & Company 01 98.8%
  • JPMorgan 01 98.3%
  • Guggenheim Partners 01 97.7%
  • Morgan Stanley 07 97.1%

Overall Employee Satisfaction

June 2026 Investment Banking

  • Moelis & Company No 99.4%
  • Morgan Stanley 02 98.8%
  • Evercore 01 98.3%
  • BMO Capital Markets 12 97.7%
  • Banco Santander 01 97.1%

Professional Growth Opportunities

June 2026 Investment Banking

  • Evercore 01 99.4%
  • Moelis & Company 01 98.8%
  • Morgan Stanley 05 98.3%
  • JPMorgan No 97.7%
  • BMO Capital Markets 12 97.1%

Total Avg Compensation

June 2026 Investment Banking

  • Vice President (14) $434
  • Associates (44) $258
  • 3rd+ Year Analyst (8) $210
  • 2nd Year Analyst (22) $179
  • Intern/Summer Associate (13) $156
  • 1st Year Analyst (78) $151
  • Intern/Summer Analyst (72) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Secyh62's picture
Secyh62
99.0
3
BankonBanking's picture
BankonBanking
99.0
4
kanon's picture
kanon
99.0
5
Betsy Massar's picture
Betsy Massar
98.9
6
CompBanker's picture
CompBanker
98.9
7
dosk17's picture
dosk17
98.9
8
GameTheory's picture
GameTheory
98.9
9
DrApeman's picture
DrApeman
98.9
10
Linda Abraham's picture
Linda Abraham
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”