Let's consider our tour of the StockCentral's Screener by trying to reproduce some of the predefined screens present in ICLUBcentral's other screening product, Stock Prospector.
Growth Companies
The screen for growth companies has these criteria:
- EPS 5-year R2 > 0.95
- Historical 5-year Sales Growth Rate > 15%
- Historical 5-year EPS Growth Rate > 15%
- Projected EPS Growth Rate > 15%
- Relative Value < 1.0
The StockCentral Screener has four of the five criteria, so you can set the appropriate minimum values for them. The Screener doesn't have a Projected EPS Growth Rate, so I would recommend instead setting the minimum Take Stock Quality Rating to "Acceptable."
Quality Companies
Prospector uses these criteria:
- EPS 5-year R2 > 0.95
- Historical 10-year EPS Growth Rate > 10%
- PTI Rating > 4
- ROE Rating > 4
I would use these settings for the StockCentral Screener:
- EPS 5-year R2 > 0.95
- Historical 5-year EPS Growth Rate > 10% (There is no 10-year growth rate in the Screener)
- minimum Pretax Profit Margin Trend - Even
- minimum ROE Trend - Even
Actually, I might just be tempted to focus on the one specific quality criterion in the Screener, the Take Stock Quality Rating and use that alone. You could use that separately, setting the minimum Take Stock Quality Rating to Acceptable, or you could use it in conjunction with the four criteria mentioned here.
I actually haven't done this. If you try it, why not report your results here!
Safe Companies
Prospector uses these criteria:
- Beta < 1
- Capitalization > $3 Billion
- Dividend Growth Rate > 15%
- EPS 5-year R2 > 0.95
- Historical 10-year Sales Growth Rate > 10%
- Historical 10-year Sales Growth Rate > 10%
This one is more difficult to reproduce with the StockCentral Screener because the Beta, Capitalization and Dividend Growth Rate criteria aren't present.
I would:
- use the 5-Year Sales and EPS Growth Rates
- Replace Capitalization with Sales and select the minimum Size to be large companies
I might also select companies with relatively low P/E ratios and low Debt to Equity ratios.
Homework
I'll leave you today with a homework assignement:
- Try using the Screener
- Tell me how you use it, want to use it, or would like to use it ...
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