Using Stock Screeners to Identify Stocks of Interest

Written by The Dividend Guy on April 15, 2006

If I am just looking for some of the next stocks that I would like to dig a bit deeper on, one of the places I like to start is through the use of a stock screener.

There are a lot of screeners out there - some of them are free and some of them are not. The one I like to use is the Yahoo! Finance Screener. You can use the basic HTML screener, but it is not as powerful as the Javascript one. I like to use the java on - it is really quick and I have never had any problems with it.

Once you are in the screener, you essentially click on the boxes to put your criteria in. As a dividend investor, here is one of the screens that I like to run:

    Index = S&P500
    P/E < = 15
    Yield >= 3
    Earnings Growth Past 5 Years >=5
    Total Debt/Equity < = 0.5

The results from this list will give a company that is cheaper based on its P/E ratio, has a high dividend yield, has show earnings growth over the past 5 years, and has a level of debt that is not too high. Overall, a healthy company from the standpoint of these numbers. From this list, I am now comfortable digging in to a couple of the stocks that are on the list to do some further analysis.

Keep one thing in mind however - you need to do additional research on the company and the stock. I do not recommend simply running a screen and then going out and buying the top results. You need to dig deeper into things like management and dividend growth to become comfortable enough to buy. The screener however gives you a good place to start.


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4 Comments so far

  1. The Dividend Guy Blog » Blog Archive » Watch List - Another Way to Identify Stocks to Study April 16, 2006 8:43 pm

    […] home about books portfolio « The Dividend Guy Blog home page « Using Stock Screeners to Identify Stocks of Interest […]

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  4. Tatiana October 30, 2008 11:52 am

    very useful info …thanks for posting

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