Looking for a stock for a longterm buy

Screening Filters

1. market_cap_category = mega, large

   • Purpose: Focus on established, financially resilient companies.
   • Rationale: For a long-term buy, mega- and large-cap stocks are usually better candidates because they tend to have stronger balance sheets, more stable earnings, and better durability through market cycles.

2. moving_average_relationship = PriceAboveMA200, PriceAboveMA20

   • Purpose: Identify stocks that are in a positive trend both long term and short term.
   • Rationale: Price above the 200-day moving average suggests the stock is in a healthy long-term uptrend, while price above the 20-day moving average confirms near-term momentum is also supportive. This helps screen for stocks with continued strength rather than weak or declining names.

3. comparison_between_indicators = price > ema_200

   • Purpose: Reinforce long-term bullish technical structure.
   • Rationale: This duplicates the long-term trend check in a more direct way. If price is above the 200-day EMA, it signals the stock is trading above its long-term average and is more likely to be in a sustained uptrend, which is desirable for long-term investors.

4. sector = Healthcare, Consumer Non-Cyclicals, Utilities

   • Purpose: Narrow the screen to defensive, more dependable sectors.
   • Rationale: These sectors are typically favored for long-term investing because they often have steadier demand, more predictable cash flows, and lower sensitivity to economic cycles. That makes them well suited for investors looking for durable holdings rather than aggressive speculation.

5. region = US

   • Purpose: Limit results to U.S.-listed companies.
   • Rationale: U.S. stocks generally provide strong reporting standards, high liquidity, and broad analyst coverage, which makes long-term evaluation easier and more reliable.

6. return_on_equity min = 12

   • Purpose: Require solid profitability.
   • Rationale: ROE above 12% helps ensure the company is generating acceptable returns on shareholder capital. For long-term buy candidates, this is a useful quality filter because it favors businesses that create value efficiently.

7. free_cash_flow_ttm min = 0

   • Purpose: Ensure the company is producing positive cash flow.
   • Rationale: Positive free cash flow is important for long-term investing because it supports dividends, debt reduction, reinvestment, and resilience. Companies that consistently generate cash are usually more durable over time.

8. debt_equity max = 1.5

   • Purpose: Avoid excessively leveraged companies.
   • Rationale: Long-term investors generally want businesses that are not overloaded with debt. A reasonable debt-to-equity ceiling reduces balance sheet risk and lowers the chance that financial stress harms long-term performance.

9. current_ratio min = 1

   • Purpose: Check short-term liquidity.
   • Rationale: A current ratio above 1 suggests the company can cover its near-term obligations with current assets. That is a basic sign of financial stability, which matters for long-term ownership.

10. quick_ratio min = 0.8

    • Purpose: Strengthen the liquidity check using a stricter measure.
    • Rationale: The quick ratio excludes inventory and gives a more conservative view of short-term financial strength. This helps screen for companies that can meet obligations even without relying on slower-moving assets.

11. quarter_revenue_yoy_growth min = 0

    • Purpose: Require at least non-negative sales growth.
    • Rationale: Long-term buy candidates should ideally be growing their business. Positive or at least non-declining revenue helps confirm the company is not stagnating.

12. quarter_eps_yoy_growth min = 0

    • Purpose: Require at least non-negative earnings growth.
    • Rationale: Earnings growth indicates the business is translating revenue into bottom-line performance. This is especially useful for long-term investors because earnings power ultimately drives valuation and returns.

13. pe_ttm max = 30

    • Purpose: Avoid overpaying for earnings.
    • Rationale: A P/E ceiling helps filter out stocks that may already be priced too aggressively. For long-term investing, a reasonable valuation improves the odds of strong future returns.

14. ev_ebitda max = 20

    • Purpose: Add another valuation sanity check.
    • Rationale: EV/EBITDA captures enterprise value relative to operating earnings and is useful for comparing companies with different capital structures. Keeping it capped helps ensure the stock is not excessively expensive.

15. dividend_payout_ratio max = 75

    • Purpose: Favor sustainable dividends.
    • Rationale: For long-term investors, dividend stocks are attractive when the payout is supported by earnings and cash flow. A payout ratio under 75% helps reduce the risk that dividends are overextended.

Why Results Match:

• The screen is built for quality, stability, and durability, which are the core traits most long-term investors want.
• It combines strong fundamentals like profitability, cash flow, liquidity, and manageable leverage with reasonable valuation and positive trend confirmation.
• The sector and market-cap filters tilt the results toward established U.S. companies in defensive areas of the market.
• The dividend payout filter further supports long-term ownership by favoring companies that can sustain shareholder returns over time.

In short, these filters are appropriate because they aim to find stocks that are financially sound, growing, not overly expensive, and suitable for holding over the long run.