Introduction Return on assets is widely used as a measure of company performance. The main reason why many companies prefer its use is because it is very attractive to the investors. This is because the ratio focuses on the returns to the shareholders. However, ROE should not be used blindly because it comes with scores of limitations. If not used cautiously, its can lead to focus on less important issues at the expense of the business fundamentals. In a bid to maintain a strong ROE, companies may tend to maintain artificial financial strategies, and fail to reveal weakening performance in the business (European Central Bank, 2010). Main Body ROA comprehensively incorporates the assets that are used to generate income for the business. With this ratio, a company can be able to establish whether its assets are in a position to generate sufficient return, as opposed to revealing of healthy returns on sales. The asset incentive industries, such as the real estate, should have a lot of income compared to those which do not need a lot of assets, such as the hospitality industry companies. Indeed, even a very little margin for the hospitality industry can generate a very strong return on assets. Perhaps, this is the reason why the hospitality industries have substantially better ROA compared to the real estate industry. In this study, I will start by analyzing the ROA of 14 companies from Oman and Saudi Arabia, 4 of which belongs to hospitality industry and 8 of which belongs to real estate industry. Then, I will carry out a trend analysis on the net margin performance for the 14 companies, with the aim of highlighting their performance trend. On a separate section, I will analyze the ROA and ROE of the two industries, and finally analyze the applicability and limitations of using ROA and ROE as a performance metric. Figure 1: Company vs. Return on Assets and return on average assets. Figure 1 above shows the Return on Assets and the Return on average assets of all the 14 companies, 4 from hospitality industry and 8 from real estate industry. In a different section of the paper, use of ROA as a performance metric is recommended, therefore, analysis of this ratio for individual companies for the current year (2010) is deemed important. Evidently, the relationship between Return on Assets and Return on average Assets is virtually directly proportional, therefore, the use of Return on average Assets is squarely for clarity purpose – otherwise ROA is given more weight in this model. The ROA for hospitality industries is viewed to be healthier relative to that the real estate industry. Indeed, real estate companies such as Emaar the Econimic Tijara and Real Estate have registered a negative figure – this model will illustrate why we should not rush to conclude that these companies are performing poorly because of this reason alone (Manzler, 2004). Figure 2: 3 – Year industry Average Net Margin trend for both hospitality and Real estate industries. As illustrated in figure 2 above, the hospitality industry has registered positive net margins; however, the trend seems to be on the decline. On the other hand, the real estate industry registered the worst performance during 2008, perhaps due to global financial cris