What does Retained Earnings mean?
Retained earnings refers to the portion of net income which is retained by the company rather than distributed to its owners as dividends, i.e. the profits a company has reinvested in itself.
Stockopedia explains Retained Earnings...
Retained earnings reflect a company's dividend policy - to Warren Buffett, the ability to use retained earnings wisely is a sign of good company management. If the company management cannot do any better with earnings than he can, then he observes that he is better off if the company pays him the full amount in dividends
