These stocks have ROE above 20%, indicating highly efficient use of shareholder capital. High ROE often signals competitive advantages and quality management.
This page lists 50 US-listed stocks screened from a universe of 4,500+ companies analysed daily from SEC EDGAR 10-K and 10-Q filings. Both Claude and ChatGPT independently rate every company; the picks below are sorted by combined AI confidence. Updated June 10, 2026 at 11:35 AM UTC.
Return on Equity (ROE) measures how much net profit a company generates per dollar of shareholder equity. ROE above 20% means the business is exceptionally efficient at converting invested capital into profit, typically signaling either a strong competitive moat (brand power, network effects, intangible assets), excellent management, or both. Warren Buffett famously prizes ROE as one of the cleanest indicators of business quality.
We screen the 4,500-stock universe for ROE above 20%, calculated from net income divided by stockholders equity in the latest SEC 10-K or 10-Q filing. We then require an AI grade of A+, A or B from both Claude and ChatGPT — eliminating companies where high ROE is masking deteriorating fundamentals. Stocks graded C or D are excluded even if ROE is high, since elevated ROE alone is not enough.
These are the fundamental indicators our AI weighs when ranking high roe stocks. All values are sourced from SEC EDGAR financial filings.
The headline metric. Above 15% is good; above 20% is exceptional and the threshold for this list.
High ROE achieved through leverage is fragile. Cross-check that debt-to-equity is reasonable.
Sustained high ROE typically requires high margins — pricing power is hard to fake.
How efficiently the company uses its asset base. High ROE = high margin × high turnover × leverage.
Common terms used throughout our analysis of high roe stocks.
How high roe stocks compare to other AI-analysed stock strategies on MarketsHost.
Return on Equity (ROE) measures how efficiently a company generates profits from shareholder equity. Higher ROE (above 15%) typically indicates strong competitive position and good management.
Not always. Very high ROE can result from high debt levels rather than operational efficiency. AI considers debt-to-equity alongside ROE in its analysis.
ROE above 15% is generally good, above 20% is excellent. Industry averages vary — tech often has higher ROE than utilities.
ROE = Net Income ÷ Stockholders Equity. We pull these directly from the latest 10-K or 10-Q filing on SEC EDGAR.
Sustained high ROE attracts competition, which typically drives ROE down to industry averages. Companies that maintain high ROE for years usually have something competitors can't replicate — brand, network effects, patents, or scale advantages.
Be cautious. ROE inflated by leverage (the equity multiplier in DuPont decomposition) is fragile. Cross-check with ROA (return on assets) — if ROA is also high, the business is genuinely efficient.
Around 15-18% on average, though individual sectors vary widely. Software and consumer brands tend toward 20-30%; utilities and basic materials are usually 8-12%.
Above 50% sometimes signals accounting anomalies, share buybacks reducing equity to near-zero, or unsustainable conditions. Investigate the cause before assuming durability.