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No. of Recommendations: 7
Thanks much, Hewitt. A quick follow-up if I may. Even though the screen pulls ROE and balances against debt-to-equity, I'm also a big believer in return on invested capital (ROIC), for the simple reason that careful capital allocators, historically, produce better returns.

Also: The very best venture firm I know, Sequoia Capital, uses the theme if not the number behind ROIC as a guiding principle for investing. (Partners call it the ability of a start-up to "light a fire with a single match.") It's one of the chief reasons Michael Moritz wrote a $1 million check to Google in its early days.

I mention this because many of the current Scrooge picks are excellent allocators. KHD Humboldt Wedag has earned 14.6% on capital invested over the trailing 12 months and has produced progressively higher returns every year since 2004. Others:

GigaMedia - 11.2%
ExxonMobil - 36.4%
Tenaris - 16.7%
Continental Resources - 39.8%

TDAMERITRADE is a financial and deals mostly in equity. Its ROE is, therefore, most important. Trailing total: 31.7%.

And here, once again, is a link to the published article: http://www.fool.com/investing/general/2008/12/24/how-scrooge...

FWIW and Foolish best,

Tim
TMFMileHigh
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