Stock Screener – How to Research and Filter Stocks Ideas – 2021

Stock Screener – Revenue Growth – Value Investing and Undervalued Stocks

If you aren’t using a stock screener regularly as part of your stock selection process, let me encourage you to consider doing so. Stock screeners are tools that let you sort through mounds of information and find companies that meet the characteristics you outline.

This process will save you hours of work and, best of all, you can access good stock screens on the Internet for free.

Why You should Use a Screener

  • Save Time – Beyond the time savings, stock screens help you with another important part of your investing strategy. By using screens to create shortlists of stocks for further consideration, you systematically build your portfolio, rather than chase whatever hot stock captures your attention at the moment.

It is too easy for many investors to purchase stocks haphazardly without regard to diversification or any disciplined approach. There are many ways investors hear about “good” stocks to buy and most of them end in disaster. A friend’s or co-worker’s hot tip usually ends up being yesterday’s hot tip.

  • Hot Stock Tips – If the stock was a good buy yesterday, it’s not one today because the price has gone through the roof. In some cases, the tip is just information passed on from another source that you don’t know and have no idea what their motivation might be in encouraging people to buy.

Companies in the news will often catch an investor’s eye; unfortunately, it will also catch the eye of thousands of other investors. You find may soon become a price balloon just waiting to pop. Try your hand at some basic screens and see what power it gives you. Think about using screens to help you construct a thoughtful portfolio built on well-researched companies.

  • Don’t Let Stock Screens Cloud Your Judgment – Stock screens are, as the name implies, tools that let you sift through vast numbers of stocks to find only those that meet certain criteria. These computer programs are great aids in reducing the number of stocks you might consider investment candidates down to a manageable number.

For example, you might run a screen looking for stocks that have grown by a certain percentage in sales revenue, earnings per share and dividend yield over the past five years.

Research and Filter Stocks Ideas
Stock Screener

Strategies for using a Stock Market Screener

Many investors use a stock market screener as a starting point in their stock research efforts as a way to filter for stocks that meet a specific set of criteria they have identified in the stocks they believe will make good investment candidates.

Many of the available stock market screeners can be used to search through all the major criteria that can be important to investors to be very specific in defining the attributes that are important to you as an investor.

Some Criteria You Can Search For

Taking the Yahoo! Finance stock market screener as an example, some criteria you can filter for in your search include:

  • Share Data – stock price, company market cap, dividend yield, beta.
  • Sales and Profitability – revenue, profit margin
  • Valuation Ratios – Ratios including Price/Earnings, Price/Book, Price/Sales, Price/Earnings to Growth (PEG)
  • Analyst Estimates – One year and five years estimated earnings-per-share (EPS) growth

Some Stock Screening Ideas

The following are some stock screening ideas you might consider, depending on your investor profile.

revenue growth stock screener
Undervalued Growth Stocks – Yahoo! Finance

Revenue Growth Stock Screener

Growth stocks can be good stock choices for investors with good tolerance for risk and a relatively long investing timeframe. Some criteria growth stock investors can use for screening include:

  • The market cap of $500 million to $2 billion
  • a 5-year growth rate of 15% or greater
  • Estimated earnings growth of 15% or more for the next 5 years
  • Current ratio minimum of 1.5

GARP Stocks Screener

GARP (Growth at a Reasonable Price) stocks are for investors who are looking for a balance between growth and value. A GARP stock screen might include all the growth stock parameters and a PEG (Price/Earnings to Growth) of less than 1.

Value Stocks Screener

Value investing, made famous by well-known investors like Benjamin Graham and Warren Buffett, is about looking for good solid undervalued stocks that have temporarily fallen out of favor from the market, leading to good buying opportunities. Along with a PEG ratio of less than 1, a screen for value stocks might include:

  • Price/Earnings ratio of less than 18
  • Price/Book ratio of less than 3
  • Projected Earnings-per-Share (EPS) growth of at least 10% for the next two years
  • Current ratio minimum of 1.5

All the Yahoo Finance Screeners Availiable

Yahoo Finance Screeners
Most Shorted StocksStocks with the highest short interest positions from Nasdaq and NYSE reports released every two weeks.
Undervalued Growth Stocks Stocks with earnings growth rates better than 25% and relatively low PE and PEG ratios.
Growth Technology StocksTechnology stocks with revenue and earnings growth in excess of 25%.
Day Gainers Stocks ordered in descending order by price percent change with respect to the previous close.
Day LosesStocks ordered in ascending order by price percent change with respect to the previous close.
Most Actives Stocks ordered in descending order by intraday trade volume.
Undervalued Large Caps Large cap stocks that are potentially undervalued.
Aggressive Small Caps Small cap stocks with earnings growth rates better than 25%
Small cap gainersSmall Caps with a 1 day price change of 5.0% or more.
Top Mutual Fundsunds with Performance Rating of 4 & 5 ordered by Percent Change
Portfolio AnchorsFunds with Performance Rating of 4 & 5 and top-half returns that could serve as a rock-solid core of an investor's portfolio
Solid Large Growth FundsLarge Growth Funds with Performance Rating of 4 & 5 and top-half returns
Solid Mid-Cap Growth FundsMid-Cap Growth Funds with Performance Rating of 4 & 5 and top-half returns
Conservative Foreign FundsForeign funds with Performance Rating of 4 & 5, low risk and top-half returns
High Yield Bond High Yield Bond with Performance Rating of 4 & 5, low risk and top-half returns

How to Use a Stock screener

The best approach to use a stock screener to find stocks worth watching

  • Having an accelerated Earnings Per Share or EPS – A momentum stock has to demonstrate an accelerated and good fundamentals on the company’s record. Picking stocks which are exhibiting high EPS (Earnings Per Share) ratings as well as increasing growth rate from the past quarters, you can be certain that this specific company keeps growing above the average rate.

Wall Street appreciates returns which are evolving rapidly. And therefore, a business that shows such performance is going to be treated with institutional support through higher or bigger funds, boosting its share value.

  • Having upwards to 25% earnings annually for 3 consecutive years or longer – It must show that they’re effective and a strong player within their market and consequently establish their value by showing strong yearly revenues.

Lower than a 25% yearly increase in yearly returns will likely not encourage recognition by the major mutual funds or stock investors causing the stock price to remain stagnant or having a too slow to be recognized by the momentum of stock investors.

  • Having a minimum volume of 100,000 – To be considered a momentum stock, it must have a daily volume average of at least 100,000 shares, and it’s a plus if their daily volume is increasing consistently which causes the stock value to rise.

The daily volume of less than this wouldn’t make it interesting to momentum investors and sometimes, if you opt to go for such, there you could have troubles with the stock’s liquidity when you need to sell it in the future or simply want to get out of it.

Stock Screener – Research and Filter Stocks Ideas

  • Having a Return of Equity (ROE) of around 17% or higher ROE or return of equity is the returns or net income divided by the number of shares owned by stock investors. It explains the reliable returns based-on capital by the investors, basically, the higher the return ratio means good for investors.

This is probably among the vital attributes when picking good stocks to buy.

  • Having some kind of leadership role in the market – Whenever the major indices decline, a true stock leader demonstrates toughness simply by holding or perhaps outperforming their previous all-time high.

And, if there is a rally with the major indices, momentum market leaders shoot to the new highs even outpacing the market.

  • Have price at an all-time high – Trading stocks at these levels along with major technical entry points, you could enjoy the trend while the stock or share price is rising. This particular attribute maximizes the possibilities for profits, as when an upward trend is occurring, it’s commonly known to stay in place 6 times than the typical. It seems like luck is on your side when this happens.

You can use the graphs and history of each company you’re interested in investing in. It may take some time to master your research and monitoring, but with constant study and practice, you will be able to recognize it quickly.

  • Fine Print – Read the fine print before investing money in a screening service that promises or implies winning stocks every time. One of the ways screens achieve results is through some very active trading. Here’s how some of them work. Say a screen promises to pick the top growth stocks, and it uses six different criteria to screen out all but the best and fastest-growing stocks (so it says).

Assume that the number is 50 individual stocks for the sake of discussion. To keep the screen’s cumulative gains high, the Website assumes that an equal number of shares of all 50 stocks are bought. Here’s the tricky part. At the end of the month, the screen is re-run and reconstituted, which means stocks from the original screen that have slipped in performance are dropped and hot, new stocks are added.

  • Repeat Performance – screen always has the top stocks in its portfolio, even if it has to turn over many of them each month to make sure only the fastest-growing stocks are in the portfolio. Does the screen produce the results it claims? Yes, it does, unless you are discounted for taxes and commissions.

Can you achieve those results? Few of us can buy 50 individual stocks at a time and turning over 25% – 60% each month would be a lot of work and run up a big tax bill because the stocks you would be selling still are most likely posting gains, they just aren’t growing fast enough for the screen.

If you can only afford to buy a few stocks out of the screen, which ones do you buy, and how do you know they aren’t the ones, which will fall off next month? Your best use of screens is to narrow down investment candidates to a few stocks, then you can do further research. Don’t rely just on the screen for your buying decision.

How to find Free Stock screener?

Many sites on the Internet offer screening tools free and others for a fee. Some are quite sophisticated in the level of detail you can use in the screen.

Some sites tout the performance of their screens by tracking over time how well the stocks in a preset screen perform. You might see a Website claim their growth screen has beat the S&P 500 by 50% for the past four years or has grown by 125% in the past three years.

Some Websites encourage you to subscribe to a “premium” service to gain access to their advanced screening tools, which will give you stocks that have a tremendous record against the S&P 500.


Best Free Stock Screeners


Stock screens are great tools and there are plenty out there for you to use, just don’t make the mistake that you can easily duplicate a screen’s track record.


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