The Globe and Mail attempts to identify Canada's most profitable companies outside of the S&P/TSX composite index in its Thursday edition. The Globe's Ian Tam writes in the Number Cruncher column that return on equity is an extremely important metric when measuring profitability of companies. ROE is typically calculated by taking the company's trailing four quarters' bottom line (net income), and dividing this by the average shareholder's equity over the same period. This ratio tells us how much profit is being made using the money invested by common shareholders. Mr. Tam looked for companies that have shown their shareholders that not only are they currently profitable, but they are profitable on a reasonably consistent basis over a longer time frame. To find lesser-known names showing the above traits, Mr. Tam ranked stocks outside of the S&P/TSX composite index on the following factors: latest reported ROE; quarterly ROE momentum; and average ROE over the past three, five and 10 years. To qualify, companies must have a market capitalization greater than $80-million. Mr. Tam recommends Leon's Furniture, Rogers Sugar, Canaccord Genuity Group, Pure Technologies and Valener.