Screening Filters
Market Cap ≥ $50B (market_cap: {'min': '50000000000'})
- Purpose: Focus on large, established U.S. companies.
- Rationale: When someone asks “What U.S. stocks should I buy?” without adding constraints (like small caps, turnarounds, deep value, etc.), a sensible default is higher-quality, more stable businesses. Large-cap companies:
- Tend to have more predictable earnings and stronger balance sheets.
- Are usually more liquid (easier to buy and sell without big price impact).
- Are often better-covered by analysts and have more available information.
S&P 500 Components Only (is_index_component: ['GSPC'])
- Purpose: Restrict to companies in the S&P 500 index.
- Rationale: The S&P 500 is a widely used benchmark of major U.S. companies. Limiting to S&P 500:
- Ensures the stocks are significant players in their industries.
- Implicitly filters for a minimum level of size, liquidity, and financial viability (since index inclusion has criteria).
- Matches a “core holdings” style that many long-term investors use.
Listed on Major U.S. Exchanges (list_exchange: ['XNYS', 'XNAS', 'XASE'])
- Purpose: Ensure the stocks trade on primary U.S. exchanges (NYSE, NASDAQ, NYSE American).
- Rationale: This directly addresses “U.S. stocks” by:
- Excluding OTC/pink sheet names and foreign primary listings.
- Focusing on more regulated, transparent markets with better disclosure standards.
Net Margin ≥ 15% (net_margin: {'min': '15'})
- Purpose: Target companies with strong profitability.
- Rationale: Net profit margin measures how much profit a company keeps from each dollar of revenue. A 15%+ margin is generally considered healthy and indicates:
- Pricing power or operational efficiency.
- Some buffer against cost pressures and downturns.
- A preference for higher-quality businesses vs. low-margin, more cyclical names.
Return on Equity (ROE) ≥ 15% (return_on_equity: {'min': '15'})
- Purpose: Select companies that generate attractive returns on shareholders’ capital.
- Rationale: ROE is a key quality metric. A 15%+ ROE often suggests:
- Effective management and good capital allocation.
- Competitive advantages (brands, network effects, cost advantages, etc.).
- Better long-term compounding potential than low-ROE peers, all else equal.
5-Year Revenue CAGR ≥ 8% (revenue_5yr_cagr: {'min': '8'})
- Purpose: Ensure the companies are not just profitable, but also growing at a solid pace.
- Rationale: A 5-year compound annual growth rate of 8%+ in revenue:
- Filters out stagnant or declining businesses.
- Focuses on companies expanding their top line faster than typical GDP growth.
- Increases the chance of future earnings growth, which is often a key driver of long-term stock returns.
Why Results Match Your Question (“What U.S. stocks should I buy?”)
- They are U.S.-listed and large, established companies (major exchanges, large market cap, S&P 500), which is a reasonable starting universe for general “what should I buy” questions.
- Within that universe, the screen emphasizes quality and growth:
- High profitability (net margin).
- Efficient use of capital (ROE).
- Solid multi-year revenue growth (5-year CAGR).
- The combination aims to surface financially strong, growing U.S. blue-chip type stocks, which many investors use as core long-term holdings.
Note: This screen does not consider valuation, sector diversification, or your personal risk tolerance/time horizon, which are important next steps before deciding what you personally should buy.
This list is generated based on data from one or more third party data providers. It is provided for informational purposes only by Intellectia.AI, and is not investment advice or a recommendation. Intellectia does not make any warranty or guarantee relating to the accuracy, timeliness or completeness of any third-party information, and the provision of this information does not constitute a recommendation.