Stock Screening

As a dividend investor, I consistently use the Dividend Achievers and Dividend Aristocrats list when coming up with potential future investment ideas. However, one thing that I have been doing lately is using online stock screens to further narrow down my search. It has been interesting because it has allowed me to really hone in on specific traits of a company that are important to my investment philosophy. I do not use these screens as a buy filter – just because the company shows up on the screen does not mean that I am going to buy it. The purpose is simply to generate qualified ideas that are worthy of additional analysis and research. With these stocks I can then plug them into the Stock Selection Guide from the CSA and see how the company has performed over the past 10 years.

The online screening software that I have been using is the screener available as part of the MSN Money Investment Toolbox. It is a very full featured for something that is free and allows users to enter as few or as many parameters as needed to develop a list of stocks. The only downside is that for those of you who are devoted Firefox users (like me) will need to succumb and use Internet Explorer. It has something to do with Active X components. There may be a way to use it in Firefox through an add-in or something, but I have not looked.

I have a standard set of 7 criteria that I enter into the screen to identify the dividend stocks. I have found that these 7 criteria produce a manageable list of stocks – it provides some good selection but not too many! Once these are entered, I may add or remove others to further narrow down the list, but I always have these 7 in there.

1. 5-Year Dividend Growth greater than or equal to 10
2. Current Dividend Yield greater than or equal to 1
3. Current Dividend Yield greater than or equal to Div. Yield: 5-Year Avg.
4. Annual EPS Growth Rate greater than or equal to 10
5. P/E Ratio: Current less than or equal to S&P 500 Average P/E Ratio: Current
6. Debt to Equity Ratio less than or equal to 0.5
7. S&P Index Membership equal to S&P 500

As of November 21st, here are the top 10 stocks on this list, sorted by 5 year dividend growth:

MSN Screener Results

Some interesting results, some of which I would not look at such as Molex. However, it does provide some interesting ideas. As mentioned earlier, the stocks the screener identifies is not a buy list. As with all stock research, an investor needs to confirm key pieces of data. These websites can have data wrong and it would be bad if you based a decision on poor or incorrect information. Remember the phrase, crappy data it, crappy data out. Further research is required for the stocks you are interested in pursuing. Stock screens are only a source of ideas.

(Photo Credit: Capgros)

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11 Comments   |  

11 Comments

November 22, 2007, 9:00 am

[…] Check it out! While looking through the blogosphere we stumbled on an interesting post today.Here’s a quick excerpt [IMG Stock Screening] As a dividend investor, I consistently use the Dividend Achievers and Dividend Aristocrats list when coming up with potential future investment ideas. However, one thing that I have been doing lately is using online stock screens to further narrow down my search. It has been interesting because it has allowed me to really hone in on specific traits of a company that are important to my investment philosophy. I do not use these screens as a buy filter – just because the […]

November 22, 2007, 9:03 am

One thing you miss by using 5 years as a history is that it looks like Mattel actually cut its dividend just before that…

November 22, 2007, 9:10 am

[…] Check it out! While looking through the blogosphere we stumbled on an interesting post today.Here’s a quick excerpt [IMG Stock Screening] As a dividend investor, I consistently use the Dividend Achievers and Dividend Aristocrats list when coming up with potential future investment ideas. However, one thing that I have been doing lately is using online stock screens to further narrow down my search. It has been interesting because it has allowed me to really hone in on specific traits of a company that are important to my investment philosophy. I do not use these screens as a buy filter – just because the […]

November 22, 2007, 9:17 am

I love MSN’s screener and portfolio manager. The one item I wish it had was number of consecutive years of dividend growth and compound annual growth rate over an extended period.

Best Wishes,
D4L

November 22, 2007, 10:05 am

[…] MINI2 – Fuel For Your MINI Obsession – MINI Cooper – S – One – Diesel – Works – Cabrio wrote an interesting post today!.Here’s a quick excerpt [IMG Stock Screening] As a dividend investor, I consistently use the Dividend Achievers and Dividend Aristocrats list when coming up with potential future investment ideas. However, one thing that I have been doing lately is using online stock screens to further narrow down my search. It has been interesting because it has allowed me to really hone in on specific traits of a company that are important to my investment philosophy. I do not use these screens as a buy filter – just because the […]

November 30, 2007, 7:02 pm

[…] Dividend Guy presents Top 7 Screening Criteria When Using Online Screening Software to Find Dividend Stocks posted at The Dividend Guy […]

cannon_fodder
May 31, 2008, 1:34 pm

It would be helpful for people who aren’t as knowledgeable if you would have put the units of measurement behind your numbers.

For example, criterion #1 – are you looking for Dividend Growth over 5 years of 10% annually? 10 fold? 10% total?

The same question for #2 and #4 – the units are unclear and make all of the difference.

November 19, 2009, 3:56 pm

,..] http://www.thedividendguyblog.com is one great source of information on this issue,..]

steve
April 10, 2011, 11:11 am

Hello.

Very good article, I enjoy coming across ones with actual screening parameters, I go threw all the different articles and then make a super screener if you want to call it that. lol

The only issue I find is the screeners i use to give all the options, specially for dividend stocks, that i would like to use. Just from looking at some of your inputs i know i cant even search for because my screener doesn’t offer them, or at least I dont see the option.

Can you provide me with a “dividend stock” screener that offers more in the way of dividend interests? The link you have in the article is outdated, MSN changed there screener while back.

Thanks.

August 2, 2014, 6:33 am

Seems like this tool is no longer available. Anything comparable that replaces it?

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