ROE indicates management's ability to generate a return for each dollar of common equity investment. EPS measures the return on a per-share basis. A high ROE usually means market dominance and pricing power, while a low ROE normally means that a combination of competitive forces and poor execution is squeezing the bottom line.

The earnings per share (EPS) ratio is effectively a restatement of the return on equity (ROE) ratio. While the ROE ratio is calculated as a percentage, taking total net profit and total equity into consideration, the EPS ratio shows how much profit has been earned by each ordinary share (common share) in the year.

ROE is a measure of how much profit a company generates with each dollar of shareholder equity. It is an important indicator of a company's profitability, efficiency, and management effectiveness. On the other hand, P/E ratio is a valuation metric that compares a company's stock price to its earnings per share (EPS).

The ROE is a better gauge than simple EPS of how a company is deploying its capital to build a profitable business. The higher the ROE, the more wealth the company is creating for its shareholders, and the better return they can expect from their investment.

You can calculate earnings per share (EPS) by multiplying return on equity (ROE) by stockholders’ equity and dividing by the number of common stock shares outstanding. EPS measures how well a company uses its resources to make a profit relative to similar companies and over time.