How To Pick Stocks Using Return On Equity

[Salty]

Those stocks that i found and has high ROE stocks are usually asset light type of business and hence traded in high multiples of P/B.

In mathematical sense, low PE low P/B stocks should provide higher returns.

However, from what i noticed, it is most often that those Low PE, Low P/B stocks does not perform better than those High PB / high ROE type of stocks.

I am not sure if there is low PE, low P/B yet high growth rate type of business around.