Screening Filters
Market Cap (min $10,000,000,000)
- Purpose: Focus on larger, more established companies.
- Rationale:
- A minimum market cap of $10B steers you away from small and mid caps, which can be more volatile and risky.
- For long-term investing, bigger companies tend to have more diversified revenue streams, stronger balance sheets, and better access to capital—characteristics that support compounding over many years.
Market Cap Category: mega, large
- Purpose: Explicitly target blue-chip and near–blue-chip names.
- Rationale:
- “Mega” and “large” caps generally include industry leaders or strong contenders.
- These companies often have durable competitive advantages, established brands, and global operations, which aligns with a long-term “buy and hold” mindset in the U.S. market.
Listing Exchange: XNYS (NYSE), XNAS (NASDAQ)
- Purpose: Limit results to major U.S. exchanges.
- Rationale:
- Your question is explicitly about the US market, so restricting to NYSE and NASDAQ ensures all results are U.S.-listed stocks.
- These exchanges have high liquidity, tighter spreads, and stronger disclosure/oversight standards compared with smaller exchanges or OTC markets.
Index Component: GSPC (S&P 500), NDX (Nasdaq 100)
- Purpose: Ensure stocks are part of major, well-followed indices.
- Rationale:
- S&P 500 and Nasdaq 100 membership is a strong quality screen: companies must meet size, liquidity, and financial criteria.
- Index components tend to have:
- Extensive analyst coverage
- High trading volume (easy to enter/exit positions)
- Inclusion in index funds and ETFs, supporting stable long-term demand for the shares
- For long-term investors, this reduces the chance of ending up in obscure or structurally weak companies.
Net Margin (min 8%)
- Purpose: Filter for consistently profitable businesses with decent margins.
- Rationale:
- A net margin ≥ 8% is a sign the company is not just growing top-line but also converting revenue into real earnings.
- Profitability is critical for long-term compounding and for a company’s ability to reinvest in growth, pay dividends, or buy back shares.
- It also helps weed out highly speculative or structurally unprofitable businesses.
Revenue 5-Year CAGR (min 8%)
- Purpose: Ensure companies are not only stable but also growing meaningfully.
- Rationale:
- A revenue compound annual growth rate of at least 8% over five years targets businesses growing faster than inflation and often faster than GDP.
- For long-term investors, you generally want growth plus quality, not just stability. This filter focuses on companies with demonstrated multi-year expansion rather than one-off spikes.
P/E (TTM) between 10 and 35
- Purpose: Find reasonably valued stocks—neither distressed nor extremely expensive.
- Rationale:
- Lower bound (10): Helps avoid ultra-low P/E “value traps,” where the low multiple may reflect serious structural issues or earnings that are about to decline.
- Upper bound (35): Excludes the most richly priced, speculative growth names where much of the future success might already be priced in, which can be risky for long-term investors if expectations reset.
- This range is a practical “growth at a reasonable price” (GARP) type filter, aiming for a balance between quality, growth, and valuation.
Why Results Match Your Long-Term US Investment Goal
- You asked for U.S. stocks to buy now for long-term investment. These filters jointly:
- Restrict to large, established U.S.-listed companies (market cap, index, exchange filters).
- Emphasize quality and durability through consistent profitability (net margin) and membership in major indices.
- Require solid historical growth (revenue 5yr CAGR), which supports long-term compounding.
- Enforce valuation discipline (P/E range), avoiding both risky “too cheap” names and overly speculative “story stocks.”
Together, the screen is essentially looking for profitable, growing, large-cap U.S. companies in major indices, trading at reasonable valuations—a profile that aligns well with a long-term, buy-and-hold investment approach in the U.S. market.
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.