Why do certain companies make more money than others? A construction company makes about 10 cents on every dollar it owns. A biotechnology company currently loses about 46 cents each dollar.
That disparity isn’t about effective management vs. poor management. It’s about how these enterprises are built. Certain sectors require mines, factories, or distribution networks to function. Others are based almost completely on years of dubious study. Some earn money the day they make a sale, while others spend a decade and hundreds of millions of dollars hoping that a single product will finally work.
Return on Assets (ROA) cuts through all of that and asks one simple question: how much profit does a company make from what it owns? Tracked across industries, it reveals which sectors have established a solid formula for converting assets into earnings and which are still blowing capital while searching for one. This research uses current industry-level ROA data as of August 2026.
Key takeaways
- Industry ROA varies by 58.9 percentage points, from 12.5% in aluminum to -46.4% in biotechnology.
- Industries are divided into three tiers: 4 exceptional performers with above 8% ROA, 23 good performers with 5-8% ROA, and 104 underperformers with less than 5% ROA.
- Out of 131 industries analyzed, 22 had a negative average ROA, with healthcare leading the way.
- Materials and consumer firms are at the top of the list, with only four industries above the 8% elite threshold: aluminum, tobacco, gold, and copper.
- Biotechnology is the worst-performing industry, with an average ROA of -46.4% across 448 companies.
How to calculate the return on assets (ROA) by industry
ROA by industry assesses how well companies in a specific industry convert their asset base into net income. It’s computed as:
ROA = Net Income/Total Assets(or Average Total Assets)
Because asset intensity varies so greatly between industries a regional bank’s balance sheet is nothing like a software company’s ROA is most relevant when compared within an industry or across industries at a single point in time, as this analysis is.
ROA by Industry 2026
This update includes 131 industries with current ROA data as of August 2026, representing 3,918 individual companies. ROAs range from 12.5% (aluminum) to -46.4% (biotechnology).
The industries were divided into three tiers: four exceptional performers with a ROA of more than 8%, 23 strong performers with a ROA of 5% to 8%, and 104 underperformers with a ROA of less than 5%, which now includes 22 industries with a negative ROA.
Top Performing Industries
- The current focus is on materials and cash-generating businesses, rather than technology. Aluminum leads the list with a 12.5% ROA albeit on a short sample of only four businesses followed by tobacco at 11.3%, which maintains its lengthy run as one of the market’s most stable cash creators.
- Gold (8.4% across 33 firms) and copper (8.2%) have surpassed the 8% elite barrier, likely due to high commodity prices.
- The strongest tier of consumer businesses includes Discount Stores (7.8%), Personal Services, Residential Construction, and Lodging (all about 7.2%).
Industries currently averaging 8% ROA or higher
| Sector | Industry | ROA % | Companies |
|---|---|---|---|
| Basic Materials | Aluminum | 12.50% | 4 |
| Consumer Defensive | Tobacco | 11.30% | 7 |
| Basic Materials | Gold | 8.40% | 33 |
| Basic Materials | Copper | 8.20% | 4 |
Source: FullRatio – ROA by Industry
Strong Performers (5% – 8% ROA)
In this table, we’ve included industries with a current ROA between 5% and 8%.
| Sector | Industry | ROA % | Companies |
|---|---|---|---|
| Consumer Defensive | Discount Stores | 7.80% | 8 |
| Industrials | Tools & Accessories | 7.40% | 9 |
| Consumer Cyclical | Personal Services | 7.20% | 8 |
| Consumer Cyclical | Residential Construction | 7.20% | 18 |
| Consumer Cyclical | Lodging | 7.20% | 7 |
| Consumer Defensive | Beverages – Non-Alcoholic | 6.60% | 12 |
| Consumer Cyclical | Luxury Goods | 6.60% | 8 |
| Consumer Cyclical | Home Improvement Retail | 6.30% | 6 |
| Consumer Cyclical | Travel Services | 6.20% | 12 |
| Industrials | Industrial Distribution | 6.10% | 18 |
| Basic Materials | Building Materials | 6.00% | 13 |
| Industrials | Specialty Industrial Machinery | 6.00% | 68 |
| Healthcare | Drug Manufacturers – General | 5.90% | 14 |
| Consumer Defensive | Education & Training Services | 5.90% | 21 |
| Technology | Semiconductor Equipment & Materials | 5.80% | 29 |
| Energy | Oil & Gas Midstream | 5.80% | 40 |
| Industrials | Marine Shipping | 5.80% | 29 |
| Consumer Cyclical | Footwear & Accessories | 5.70% | 10 |
| Industrials | Engineering & Construction | 5.70% | 39 |
| Energy | Oil & Gas Refining & Marketing | 5.40% | 17 |
| Industrials | Security & Protection Services | 5.20% | 16 |
| Industrials | Building Products & Equipment | 5.10% | 27 |
| Basic Materials | Coking Coal | 5.10% | 5 |
Source: FullRatio – ROA by Industry
Why Do Some Industries Show Negative ROA?
This data source includes all publicly traded companies, regardless of profitability, including loss-making biotech, medical device, and early-stage names. This is why healthcare-related sectors dominate the bad end of the list. Biotechnology (-46.4%) is a 448-company sample significantly weighted toward pre-revenue and clinical-stage firms, while Medical Devices (-26.3%) follows a similar trend.
However, healthcare is not the only negative industry. Broadcasting (-13.6%), Auto Manufacturers (-4.1%), and Advertising Agencies (-3.8%) all represent true market pressure, not a sample effect.
Sector-specific patterns
- Financial Services has a low and consistent level of activity. Regional banks and diversified banks both have an average ROA of 1.1%, which is among the lowest in any major sector.
- Office REITs are the sole group in negative territory (-1.0%), indicating persistent stress in the office real estate market.
- Utilities operate within a narrow range of 1.3% (Renewable) to 3.2% (Regulated Gas/Water), reflecting the sector’s capital-intensive and regulated nature.
- Healthcare is divided into two distinct parts. Established generic drugmakers (Drug Manufacturers – General, 5.9%) continue to produce strong returns, whereas Biotechnology (-46.4%), Medical Devices (-26.3%), and Drug Manufacturers – Specialty & Generic (-10.2%) are all significantly negative.
- Insurance has a tight, moderate band across all sub-categories, from Insurance – Life at 1.2% to Insurance – Diversified at 3.1%, none of which are in elite or strong areas.
Underperforming Industries (0% – 5% ROA)
Industries now averaging 0% to 5% ROA positive but below the underperformer line:
| Sector | Industry | ROA % | Companies |
|---|---|---|---|
| Consumer Cyclical | Apparel Retail | 4.50% | 29 |
| Industrials | Railroads | 4.40% | 8 |
| Energy | Oil & Gas Equipment & Services | 4.10% | 47 |
| Communication Services | Publishing | 4.10% | 6 |
| Energy | Thermal Coal | 4.00% | 6 |
| Consumer Cyclical | Specialty Retail | 3.90% | 33 |
| Technology | Electronics & Computer Distribution | 3.80% | 8 |
| Real Estate | REIT – Specialty | 3.80% | 18 |
| Energy | Oil & Gas E&P | 3.70% | 61 |
| Basic Materials | Other Precious Metals & Mining | 3.70% | 11 |
| Energy | Oil & Gas Integrated | 3.60% | 10 |
| Industrials | Aerospace & Defense | 3.50% | 67 |
| Consumer Cyclical | Apparel Manufacturing | 3.40% | 14 |
| Technology | Scientific & Technical Instruments | 3.40% | 25 |
| Industrials | Consulting Services | 3.20% | 15 |
| Industrials | Business Equipment & Supplies | 3.20% | 4 |
| Utilities | Utilities – Regulated Water | 3.20% | 12 |
| Utilities | Utilities – Regulated Gas | 3.20% | 15 |
| Industrials | Pollution & Treatment Controls | 3.10% | 14 |
| Financial Services | Insurance – Diversified | 3.10% | 10 |
| Financial Services | Insurance – Property & Casualty | 2.90% | 38 |
| Utilities | Utilities – Regulated Electric | 2.90% | 33 |
| Consumer Cyclical | Restaurants | 2.80% | 42 |
| Industrials | Metal Fabrication | 2.80% | 15 |
| Real Estate | REIT – Industrial | 2.80% | 16 |
| Real Estate | REIT – Retail | 2.80% | 25 |
| Consumer Cyclical | Auto Parts | 2.60% | 43 |
| Industrials | Specialty Business Services | 2.60% | 32 |
| Consumer Cyclical | Packaging & Containers | 2.60% | 20 |
| Financial Services | Insurance – Reinsurance | 2.60% | 7 |
| Utilities | Utilities – Independent Power Producers | 2.60% | 6 |
| Basic Materials | Specialty Chemicals | 2.50% | 51 |
| Real Estate | Real Estate – Development | 2.50% | 10 |
| Utilities | Utilities – Diversified | 2.50% | 9 |
| Industrials | Integrated Freight & Logistics | 2.40% | 18 |
| Consumer Cyclical | Leisure | 2.40% | 24 |
| Financial Services | Insurance Brokers | 2.40% | 14 |
| Industrials | Conglomerates | 2.40% | 16 |
| Basic Materials | Agricultural Inputs | 2.40% | 10 |
| Consumer Defensive | Packaged Foods | 2.20% | 44 |
| Financial Services | Insurance – Specialty | 2.20% | 20 |
| Consumer Defensive | Grocery Stores | 2.20% | 9 |
| Basic Materials | Steel | 2.10% | 14 |
| Consumer Defensive | Food Distribution | 2.10% | 9 |
| Real Estate | REIT – Healthcare Facilities | 2.10% | 17 |
| Financial Services | Capital Markets | 1.90% | 55 |
| Technology | Information Technology Services | 1.80% | 47 |
| Industrials | Farm & Heavy Construction Machinery | 1.80% | 19 |
| Healthcare | Healthcare Plans | 1.80% | 10 |
| Financial Services | Credit Services | 1.80% | 39 |
| Industrials | Airlines | 1.80% | 16 |
| Financial Services | Asset Management | 1.80% | 82 |
| Real Estate | REIT – Residential | 1.80% | 20 |
| Real Estate | Real Estate Services | 1.70% | 27 |
| Industrials | Staffing & Employment Services | 1.60% | 20 |
| Consumer Cyclical | Furnishings, Fixtures & Appliances | 1.60% | 23 |
| Real Estate | REIT – Diversified | 1.60% | 16 |
| Consumer Cyclical | Internet Retail | 1.50% | 27 |
| Technology | Electronic Components | 1.50% | 38 |
| Industrials | Trucking | 1.50% | 13 |
| Industrials | Rental & Leasing Services | 1.40% | 18 |
| Technology | Semiconductors | 1.30% | 63 |
| Communication Services | Telecom Services | 1.30% | 33 |
| Utilities | Utilities – Renewable | 1.30% | 15 |
| Technology | Software – Infrastructure | 1.20% | 118 |
| Consumer Cyclical | Recreational Vehicles | 1.20% | 10 |
| Financial Services | Insurance – Life | 1.20% | 15 |
| Financial Services | Banks – Regional | 1.10% | 281 |
| Financial Services | Banks – Diversified | 1.10% | 6 |
| Consumer Cyclical | Gambling | 0.90% | 8 |
| Healthcare | Medical Distribution | 0.90% | 5 |
| Technology | Communication Equipment | 0.80% | 43 |
| Real Estate | REIT – Mortgage | 0.80% | 37 |
| Consumer Cyclical | Resorts & Casinos | 0.60% | 16 |
| Financial Services | Mortgage Finance | 0.60% | 13 |
| Industrials | Electrical Equipment & Parts | 0.40% | 41 |
| Communication Services | Internet Content & Information | 0.40% | 46 |
| Consumer Cyclical | Auto & Truck Dealerships | 0.30% | 22 |
| Real Estate | REIT – Hotel & Motel | 0.30% | 14 |
| Technology | Software – Application | 0.20% | 171 |
| Communication Services | Entertainment | 0.10% | 38 |
| Consumer Defensive | Household & Personal Products | 0.00% | 23 |
Source: FullRatio – ROA by Industry
Benchmarking Companies Within an Industry
To see how well you are performing in comparison to your competition, compare your ROA to the industry benchmarks shown above.
- Compare your ROA to industry averages. A greater ROA indicates better profit generation, whereas a lower ROA indicates underutilized assets.
- Identify strengths and weaknesses: a higher-than-average ROA indicates operational strengths, while a lower-than-average ROA suggests possible shortcomings.
- Improve ROA by improving asset usage, streamlining processes, and increasing revenue.
- Regularly track your ROA and industry benchmarks to stay ahead of changes in your sector.
It is important to note that ROA should not be your primary performance indicator. Combine it with other financial measures such as return on equity, profit margins, and ROI to get a more complete picture.
FAQs
Here we have added the most frequently asked questions about ROA:
What is the current range of ROA across industries?
As of August 2026, average industry ROA ranges from 12.5% (Aluminum) down to -46.4% (Biotechnology), a 58.9-percentage-point spread across the 131 industries with current data.
Which industries have the highest ROA right now?
Four industries currently sit in the elite tier above 8% ROA: Aluminum (12.5%), Tobacco (11.3%), Gold (8.4%), and Copper (8.2%).
Why do some industries show negative ROA?
This analysis uses a broad industry-average data source that includes every listed company, including loss-making and pre-revenue firms. Healthcare sub-industries like Biotechnology and Medical Devices are the most affected, since they include a large share of clinical-stage companies with no current earnings.
How is ROA by industry calculated?
Return on Assets equals net income divided by total assets (or average total assets), averaged across companies within an industry.
Using ROA Benchmarks in Your Business
Return on Assets (ROA) offers a useful view of how well a company uses its assets to generate profit, but it makes more sense when compared with others in the same industry. Since ROA can vary widely across industries, compare your company with similar ones rather than in isolation. By regularly checking ROA alongside other financial metrics, businesses can spot areas to improve, use their assets better, and make smarter financial decisions.
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