Getting Started With Stock Screeners (2024)

How Do You Get Started With Stock Screeners?

Selecting good stocks isn't easy. The sheer volume of companies makes zeroing in on a good stock difficult and the volumes of data on the internet don't make things any easier. In fact, it's hard to sort out the useful information from all the worthless data. Fortunately, a stock screener can help you focus on the stocks that meet your standards and suit your strategy.

Stock screeners are effective filters when you have a specific idea of the kinds of companies in which you are looking to invest. There are thousands of stocks listed on exchanges in the United States alone; it's just not feasible to track all of them on your own. A stock screener limits exposure to only those stocks that meet your unique parameters.

Key Takeaways

  • Stock screening involves searching for companies thatmeet specific financial criteria.
  • By answering a series of questions and entering your search criteria, screeners give you a list of stocks that meet your requirements.
  • Yahoo! Finance, StockFetcher, ChartMill, Zacks, Stock Rover, and Finviz offer some of the best free screeners on the web.
  • Make sure you take the screener results as a first step and remember to do your own research as well.

How Stock Screeners Work

Day traders generally use stock screeners to help them choose which stocks deserve their attention from the thousands available on global exchanges. You can use these same tools to help you make better decisions about the stocks in which you invest your money.

Stock screening is the process of searching for companies that meet certain financial criteria. A stock screener has three components:

  • A database of companies
  • A set of variables
  • A screening engine that finds the companies that satisfy those variables and generates a list of matches

Using a screener is quite easy. First, you answer a series of questions. They may include the following:

  • Do you like large-cap or small-cap stocks?
  • Are you looking for stock prices at all-time highs or companies with stocks that have fallen in price?
  • What range for the price-to-earnings ratio (P/E) is acceptable for you?
  • Are you looking for stocks in a particular industry?

Good screeners allow you to search using just about any metric or criterion you wish. When you finish inputting your answers, you get a list of stocks that meet your requirements.

By focusing on the measurable factors affecting a stock's price, stock screeners help their users perform quantitative analysis. In other words, screening focuses on tangible variables such as market capitalization, revenue, volatility, and profit margins, as well as performance ratios such as the P/E ratio or debt-to-equity ratio (D/E). For obvious reasons, you cannot use a screener to search for a company that, say, makes the best products.

Screener Options

Some of the best free screeners on the web include those offered by Yahoo! Finance, StockFetcher, ChartMill, Zacks, Stock Rover, and Finviz. They all offer users a series of basic and advanced screeners.

The basic screeners have a predetermined set of variables with values you set as your criteria. For example, one of the variables on the Finviz basic screener filters stocks by market cap, giving you the option of finding companies that fall below or exceed a certain market capitalization.

Although there are some good free screeners out there, if you want the very latest and best technology, you will likely have to get a subscription to a screening service.

Using Customizable Screeners

Let's say we're looking for an apparel company that trades on the New York Stock Exchange (NYSE) and has a P/E ratio under 25, an EPS growth of over 10% over the last five years, and a debt/equity ratio over 0.1.

Here is what the screener looks like on Finviz:

Getting Started With Stock Screeners (1)

After we enter these criteria into the screener, it gives us the companies that make it through each of the filters of our search. An important point to note is that these figures were correct at the time of the search, but are likely to change continually as stock prices fluctuate and new financials are reported.

Type of ScreenCompanies Remaining
Apparel companies32
Trading on the NYSE19
P/E ratio under 2511
EPS growth past 5 years over 10%1
Debt/equity over 0.11

Now that we have the results of the stock screen, we have one candidate worthy of further analysis—that is, if we are confident in our criteria and the values we choose for them.

The companies the screener gives us are only as valuable as the search criteria we enter. It's also important to remember that the screen is not the analysis itself. The screen can't guarantee that the company that made all our criteria is the best purchase, so we have to dig deeper to find out more.

Knowing What to Screen For

The big challenge with using screeners is knowing what criteria to use for your search. The hundreds of variables make the possibilities for different combinations nearly endless.

Screeners are extremely flexible, but if you don't know what you're looking for or why, they can't do much for you. To help investors, some sites have predefined stock screens, which have their variables already entered.

The following sites offer some of the better-predefined screens (these are just a few examples of what's out there):

  • Yahoo! Finance: This site includes several predetermined screens. Among the most notable are Undervalued Large Caps, Day Gainers, and Portfolio Anchors. The search criteria of each predetermined screen are clearly explained so you can understand the screens' underlying principles.
  • MSN Money: This one includes a series of popular screens that can further be filtered and sorted by category.
  • Finviz: This screener includes a signal drop-down menu that filters for criteria such as top gainers, recent insider buying, and wedges.

Watch Out for These Limitations

Although they are useful tools, stock screeners have some limitations. Here are some things you should keep in mind:

  • Most stock screeners include only quantitative factors. There are still many qualitative factors to keep in mind. No screener provides information about things like pending lawsuits, labor problems, or customer satisfaction levels.
  • Screeners use databases that update on different schedules. Always check the relevance and timeliness of the data. If a screener's data isn't timely, your search could be meaningless.
  • Watch for industry-specific blind spots. For example, if you are searching for low P/E valuations, don't expect very many tech companies to show up.

There are a few other general things to watch out for with these screeners. Some of the free versions come with ads, not unlike a lot of other sites. They have to make money somehow, right? This can be a little tedious to have to wade through, especially when you're trying to get your investment mojo on.

But if you're willing to shell out a few dollars, most come with premium options that can cut out the ads. Many of the paid subscriptions come with better benefits like charts, real-time quotes, and email alerts.

Do Your Research

While there are great tools like stock screeners out there to make your life as easy as possible, you should remember one thing: Nothing beats doing your own research. Just because a stock screener gives you a list of stocks that fit your search criteria, take it with a grain of salt—just like any investment advice you receive.

As mentioned, these screeners won't necessarily know about news that affects certain companies. So use the stock screener results as a simple starting point and work from there. Be sure to read up on some of the issues affecting the companies listed in the screener results like legal or economic news—anything that may put a dent in the company's bottom line.

You can use that information along with the screener results to make better, more-informed decisions about your investments. Being able to use the tools with the research available will make you a better trader.

Remember, stock screeners are not the magic pill for selecting stocks. Nothing will ever replace good old-fashioned nose-to-the-grindstone research. However, screens can be a good place to start your research process as they can save time and narrow your options down to a more manageable group.

Article Sources

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy.

  1. Yahoo Finance. "Stock Screeners."

  2. MSN. “MSN Money.”

  3. Finviz. "Free Stock Screener."

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Getting Started With Stock Screeners (2024)

FAQs

How to effectively use a stock screener? ›

Here are some things you should keep in mind:
  1. Most stock screeners include only quantitative factors. There are still many qualitative factors to keep in mind. ...
  2. Screeners use databases that update on different schedules. Always check the relevance and timeliness of the data. ...
  3. Watch for industry-specific blind spots.

How to find good stocks from Screener? ›

How to Use a Stock Screener
  1. Profit Givers: Find large-cap companies with a net profit growth of more than 15%.
  2. Value Stocks: Identify undervalued stocks using the PE and PEG ratios.
  3. Promoter Rich: Discover companies where promoters have a majority stake.
Jan 19, 2024

Are stock screeners useful? ›

Stock screeners can help you identify which stocks and funds are right for your investment strategy. You can look at price, market capitalization, P/E ratio, and more before deciding where to invest your money.

Who is the most accurate stock predictor? ›

1. AltIndex – Overall Most Accurate Stock Predictor with Claimed 72% Win Rate. From our research, AltIndex is the most accurate stock predictor to consider today. Unlike other predictor services, AltIndex doesn't rely on manual research or analysis.

How to do stock analysis for beginners? ›

There are a few aspects to consider when you wish to determine whether a share is worth investing in. The company's fundamentals: Research the company's performance in the last five years, including figures like earnings per share, price to book ratio, price to earnings ratio, dividend, return on equity, etc.

What is the most successful stock screener? ›

Best Stock Screeners
  • TradingView - Best Stock Screener (website)
  • ChartMill - Best for Casual Traders.
  • FINVIZ - Best Fundamental Screening.
  • Seeking Alpha - Best Independent Ratings.
  • Stock Rover - Handy Thumbnail Charts.
  • Yahoo Finance - Free and Easy.
  • MarketSmith - Best for CAN SLIM investors.
Mar 13, 2024

Is ticker tape better than screener in? ›

So, the choice between Ticker Tape Review and Screener Review depends on your preferences and needs. If you are looking for a comprehensive investment analysis tool with in-depth research, educational resources, and a wide range of features, Ticker Tape Review may be the better option for you.

What is the best free stock screener for day trading? ›

6 best free stock screeners
  1. Morningstar. Morningstar's basic stock screener offers a clean interface with multiple filter options. ...
  2. Finviz. Finviz is often included in roundups of the best stock screeners, and for good reason. ...
  3. 3. Yahoo Finance. ...
  4. TradingView. ...
  5. StockFetcher.
Apr 29, 2024

What is the best query in screener? ›

Best stock query
S.No.NameDiv Yld %
1.Coal India5.05
2.Mahanagar Gas1.84
3.IIFL Securities1.34
4.Redington2.87
23 more rows

How to check if stock is undervalued? ›

Price-to-earnings ratio (P/E)

A company's P/E ratio is the most popular way to measure its value. In essence, it shows how much you'd have to spend to make $1 in profit. A low P/E ratio could mean the stocks are undervalued. P/E ratio is calculated by dividing the price per share by the earnings per share (EPS).

How do you use a stock screener effectively? ›

How to Use a Stock Screener?
  1. Select a Platform. Choose a screener that meets your needs. ...
  2. Run the Screener. After setting your criteria, initiate the screening process. ...
  3. Analyse Results. Don't just stop at the list; analyse the results. ...
  4. Refine Search. ...
  5. Monitor & Update. ...
  6. Take Action.

Who gives the best stock advice for free? ›

  • Visit The Motley Fool. The Motley Fool review. ...
  • Visit Morningstar. Morningstar review. ...
  • Visit Seeking Alpha. Seeking Alpha review. ...
  • Visit StockRover. StockRover review. ...
  • Visit TradeStation. TradeStation review. ...
  • Visit Zacks Trade. ...
  • The Yahoo Finance stock screener has a clean and user-friendly design. ...
  • Stansberry Research review.

Who is the most successful stock picker? ›

Warren Buffett was generally considered the greatest stock picker of all time.

Which is the most successful stock indicator? ›

Best trading indicators
  • Stochastic oscillator.
  • Moving average convergence divergence (MACD)
  • Bollinger bands.
  • Relative strength index (RSI)
  • Fibonacci retracement.
  • Ichimoku cloud.
  • Standard deviation.
  • Average directional index.

Which trading indicator has the highest accuracy? ›

Which is one of the most accurate trading indicators? The most accurate for trading is the Relative Strength Index. It is considered one of the best momentum indicators for intraday trading. It helps investors identify the shares which are bought and sold in the market.

What is the best site to analyze stocks? ›

TradingView is a popular online platform for traders and investors, providing a wide range of tools and resources for analyzing financial markets, sharing trading ideas, and executing trades. It offers real-time data and charts for stocks, cryptocurrencies, forex, commodities, and other assets.

How do I learn stocks as a beginner? ›

Stock trading: How to get started for beginners
  1. Open a trading account.
  2. Set your budget.
  3. Learn the basic types of stock analysis.
  4. Practice with a stock market simulator.
  5. Plan your first trade.
Dec 28, 2023

How do beginners choose stocks? ›

  1. How to Pick a Stock.
  2. Determine Your Goals.
  3. 3 Types of Investors.
  4. The Diversified Portfolio.
  5. Keep Your Eyes Open.
  6. The "Story" Behind a Stock Pick.
  7. Find Your Companies.
  8. Tune-in to Corporate Presentations.

What is the simplest way to evaluate a stock? ›

Price-to-earnings ratio (P/E): Calculated by dividing the current price of a stock by its EPS, the P/E ratio is a commonly quoted measure of stock value.

What is the difference between a stock scanner and a stock screener? ›

Screeners are basically low tech and used more for longer-term trading. Stock scanners, on the other hand, came about as the internet and technology evolved. It's a powerful program on your computer that's connected to a data feed, scanning stocks for trading opportunities in real time.

What is the most profitable stock ever? ›

The Best Performing Stocks in History
  • Coca-Cola. (NASDAQ: KO) ...
  • Altria. (NASDAQ: MO) ...
  • Amazon.com. (NASDAQ: AMZN) ...
  • Celgene. (NASDAQ: CELG) ...
  • Apple. (NASDAQ: AAPL) ...
  • Alphabet. (NASDAQ:GOOG) ...
  • Gilead Sciences. (NASDAQ: GILD) ...
  • Microsoft. (NASDAQ: MSFT)

What is the most profitable stock trade ever? ›

5 of the Best Trades of All Time
  • George Soros: Breaking The Bank of England.
  • Paul Tudor Jones: Predicting The 1987 Stock Market Crash.
  • Jesse Livermore: Becoming One of the Richest Men in the World at the Start of the Great Depression.
  • Jim Chanos: The End of Enron.
  • Michael Burry: The Prosthetic-Eyed CDO Trader.
  • Conclusion.

What is the best way to monitor stock? ›

How to Monitor Your Stock Portfolio?
  1. Keep Yourself Updated About the Latest News About the Company. ...
  2. Analyze the Quarterly Results of the Company. ...
  3. Keep Tabs on Any Corporate Announcements. ...
  4. Be Aware of Any Changes in the Shareholding Pattern. ...
  5. Check the Credit Rating of The Company. ...
  6. Track the Stock Price.
May 20, 2024

How do you use a screener for day trading? ›

Define your trading goals, style, and risk appetite before using a stock screener. This will help you to choose the right filters and parameters that match your trading criteria and preferences. Use multiple filters and parameters to narrow down your screening results and to find the best stocks for intraday trading.

How do you use a trading view screener? ›

The screener feature can be found at the top of the homepage in between the 'News' and 'Community' Tabs. Hover over the Screeners tab to reveal search options. Additionally, this tab reveals heatmaps for stocks and cryptocurrency. *The Screener can also be found on the bottom tab on a charting view.

How do you make a good screener? ›

How to create an effective screener survey
  1. Know your goals. ...
  2. Define specific target audience criteria. ...
  3. Screen for behaviors and psychographics over demographics. ...
  4. Write precise, carefully worded questions. ...
  5. Put your screener questions in the right order. ...
  6. Avoid leading or loaded questions. ...
  7. Provide a catchall alternative option.

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