Ron Muhlenkamp searches for stocks starting with return on shareholder equity, then he looks for companies that have a price-to-earnings ratio that’s less than the ROE. “If everyone agrees with me, it’s usually time to sell and take my gains, I’ve found. But as long as they consider me crazy, I’m probably on the right track…That’s an example of pure stomach.” He likes homebuilders, which have a return on equity of 18 to 24 percent and are selling at eight times earnings…
http://www.muhlenkamp.com/fund_index.php
http://www.muhlenkamp.com/fund_index.php
