Home made list of stocks March 2013

Once a month I filter stocks according to Joel Greenblatt’s Magic Formula. In his book, “The little book that beats the market” he explains the reasoning behind a simple yet powerful stock filter.
He claims the system is a very good starting point for investing in stocks and explains how to generate a similar ranked list of stocks.
Here is my interpretation of the system with some tweaks.

1. Open finance.google.com and click on “Stock screener”
2. Set the filter criteria:

  • Market cap min: 45M
  • Return on assets (TTM)(%) – minimum = 0.05
  • P/E ratio – minimum = 0.5
  • Average Volume min 50000

3. To get all 3845 stocks out to a spreadsheet I cheat!

  • I use Google Chrome as the browser, the following is specific for this browser.
  • ctrl+shift+i – to open the developer tools
  • I click on the magnifying glass button at the bottom of the window to inspect an element on the page
  • I click on the “Show rows” select box
  • At the HTML code in the developer tools I click the small triangle to open the details
  • In the line “30” I Double click the first 30 and change it to 4000 I close the developer tools
  • I now select the “30” in the regular page, this will actually send a request to google’s system with “4000” as the limit.
  • Now I do ctrl+a to select the whole page, ctrl+c to copy and switch to a plain text editor and paste
  • The plain text editor helps filter out images and other fancy unimportant stuff from the web page
  • Now I copy from the text editor to a spreadsheet and clean the rows above the main table.

4. In the spreadsheet, I do the ranking and some more filtering

  • Sort by ROA (descending order), remove all stcoks with – as ROA (they don’t have assets?!
  • Add column titled: ROA rank and type 1,2 and drag down all the way to the end to complete the ranking
  • Sort by P/E (ascending)
  • Delete rows with lower than 0.5 P/E and type 1,2 and drag down all the way to the end
  • Add column “sum rank” and in it add the two ranks
  • Sort by sum rank, ascending and add final rank, type 1,2 and drag down.
  • Lastly, I like adding a percentile to the rank – I look at the total number of tickers left and divide the rank by the total number of tickers and present it as a percent.

sometimes I filter out stocks with “ADR” in their name, these are foreign stocks
I need to also filter out financial and utilities – that’s what the book says.
Here is the list for March 2013

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