Show me stocks which are undervalued

Screening Filters

1. Market Cap ≥ $2,000,000,000

   • Purpose: Focus on mid- to large-cap companies.
   • Rationale: When looking for “undervalued” stocks, larger companies tend to have more stable financials, more analyst coverage, and better disclosure. This reduces the chance that a stock looks cheap simply because it’s very risky, illiquid, or has poor data quality (common among micro/small caps).

2. Net Margin ≥ 10%

   • Purpose: Ensure the company is solidly profitable.
   • Rationale: A genuinely undervalued stock is usually a good business mispriced by the market, not a weak business that’s cheap for a reason. A net margin of at least 10% indicates the company can convert revenue into profit efficiently, making it more likely that the “cheap” valuation reflects an opportunity, not fundamental weakness.

3. Return on Equity (ROE) ≥ 12%

   • Purpose: Filter for companies that generate attractive returns on shareholders’ capital.
   • Rationale: High ROE is a hallmark of quality and competitive strength. Combining high ROE with low valuation multiples (P/E, P/B) is a classic value-investing approach: you’re looking for high-quality businesses that the market is pricing as if they were mediocre.

4. P/E (TTM) between 0.0001 and 12

   • Purpose: Target lower valuation relative to earnings.
   • Rationale: The P/E ratio is a primary measure of how much investors pay for each dollar of earnings. Capping P/E at 12 aims to capture stocks that are cheap versus current earnings, which is central to the idea of “undervalued.” The tiny positive minimum just excludes nonsensical or negative P/E values (often due to losses or data issues).

5. Price-to-Book (P/B) between 0.0001 and 1.5

   • Purpose: Target lower valuation relative to the company’s net assets.
   • Rationale: A P/B under 1.5 suggests the stock isn’t priced far above its accounting book value; in many traditional value frameworks, P/B below 1 (or modestly above it) can indicate potential undervaluation, especially for asset-heavy or financial companies. Again, the small positive minimum filters out invalid data and extreme anomalies.

Why Results Match “Undervalued” Stocks

• The low P/E and low P/B filters directly look for stocks priced cheaply relative to earnings and assets — the core of “undervaluation.”
• The profitability (Net Margin ≥ 10%) and quality (ROE ≥ 12%) filters try to ensure you’re not just getting “cheap” but also getting businesses with solid performance, reducing the risk of value traps.
• The market cap ≥ $2B filter keeps the universe to better-established companies where valuation signals (P/E, P/B) tend to be more meaningful and less distorted by illiquidity or extreme risk.

Together, these filters are designed to surface established, profitable, relatively high-quality companies that the market is currently pricing at a discount by conventional valuation metrics.