Which of the following ratios indicates a company's profitability?

Return on Equity (ROE) is a key indicator of a company's profitability, reflecting how effectively a company uses its equity to generate profit. It is calculated by dividing net income by shareholder's equity. This ratio provides insight into how well the management is utilizing investors' funds and the rate of return that shareholders are receiving on their investments.

A high ROE suggests that the company is efficiently generating income relative to the equity capital available, indicating strong financial performance and management efficiency. Investors frequently use ROE as a benchmark to compare the profitability of companies within the same industry.

In contrast, the other ratios listed focus on different aspects of financial health. Debt-to-EBITDA measures a company's ability to pay off its incurred debt, EBITDA Interest Coverage Ratio assesses the entity's ability to cover interest expenses with earnings before interest, taxes, depreciation, and amortization, and the Current Ratio evaluates liquidity by comparing current assets to current liabilities. While these ratios are important for analyzing a company's financial stability and operational efficiency, they do not directly measure profitability like ROE does.