The Motley Fool does a great job of determining what should go in place of these '1's in an article located here . To continue, let us try 'revenues'. There, that's better. Well the 'revenues' cancel so that's good. Since it's another fraction, we can expand this too.
Lets try using 'assets'.
Now we're getting somewhere. We can now see that ROE is dependent on three terms. We could probably expand these fractions until we break down each and every penny of a business, but that would probably be a bit extreme. With companies such as Coke, net margin makes a larger contribution to return on equity than in businesses such as Jacobs Engineering and Walmart. In an inflationary world however, lower margin operations will be hurt to a far greater degree than their high margin counterparts as capital expenditures skyrocket.