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    A Closer Look At Belden Inc.'s (NYSE:BDC) Impressive ROE

    Simply Wall St·01/07/2026 10:12:10
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    One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine Belden Inc. (NYSE:BDC), by way of a worked example.

    Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. Simply put, it is used to assess the profitability of a company in relation to its equity capital.

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    How To Calculate Return On Equity?

    ROE can be calculated by using the formula:

    Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity

    So, based on the above formula, the ROE for Belden is:

    18% = US$228m ÷ US$1.2b (Based on the trailing twelve months to September 2025).

    The 'return' is the income the business earned over the last year. That means that for every $1 worth of shareholders' equity, the company generated $0.18 in profit.

    See our latest analysis for Belden

    Does Belden Have A Good ROE?

    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. Pleasingly, Belden has a superior ROE than the average (11%) in the Electronic industry.

    roe
    NYSE:BDC Return on Equity January 7th 2026

    That's clearly a positive. With that said, a high ROE doesn't always indicate high profitability. A higher proportion of debt in a company's capital structure may also result in a high ROE, where the high debt levels could be a huge risk . You can see the 2 risks we have identified for Belden by visiting our risks dashboard for free on our platform here.

    Why You Should Consider Debt When Looking At ROE

    Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.

    Belden's Debt And Its 18% ROE

    It's worth noting the high use of debt by Belden, leading to its debt to equity ratio of 1.03. While its ROE is pretty respectable, the amount of debt the company is carrying currently is not ideal. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it.

    Summary

    Return on equity is one way we can compare its business quality of different companies. Companies that can achieve high returns on equity without too much debt are generally of good quality. All else being equal, a higher ROE is better.

    But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at this data-rich interactive graph of forecasts for the company.

    Of course Belden 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.