Which stocks to buy

Screening Filters

1. market_cap_category: mid, large, mega

• Purpose: Focus on established companies.
• Rationale: For a general “Which stocks should I buy?” question, it makes sense to start with companies that are typically more liquid, better covered by analysts, and generally less speculative than small caps. Mid-, large-, and mega-cap stocks are often more suitable for a broad investment screen because they tend to have more stable business models and financial reporting.

2. moving_average_relationship: PriceAboveMA200

• Purpose: Identify stocks with positive long-term price momentum.
• Rationale: Stocks trading above their 200-day moving average are usually considered to be in an uptrend. This filter helps avoid names that are technically weak or in prolonged downtrends, improving the odds of finding stocks with favorable market sentiment.

3. revenue_ttm: min 0

• Purpose: Ensure the company is generating sales.
• Rationale: Requiring positive trailing twelve-month revenue removes pre-revenue or non-operating companies. That’s important when screening for buyable stocks because it favors businesses with an actual operating base and proven demand for their products or services.

4. eps_ttm: min 0

• Purpose: Require profitability on a trailing twelve-month basis.
• Rationale: Positive EPS helps ensure the company is earning money for shareholders rather than consistently losing it. This is a useful quality filter for identifying stocks with stronger fundamental health.

5. return_on_equity: min 10

• Purpose: Find companies that generate good returns on shareholder capital.
• Rationale: A ROE of 10% or more suggests management is using equity efficiently to produce profits. This is often associated with higher-quality businesses and can help narrow the list to more attractive long-term candidates.

6. operating_margin: min 10

• Purpose: Select companies with strong core business profitability.
• Rationale: Operating margin measures how much profit the company keeps from its operations before interest and taxes. A 10%+ margin indicates pricing power, cost discipline, or a strong business model, all of which are desirable when looking for stocks to buy.

7. debt_equity: max 1

• Purpose: Limit financial leverage.
• Rationale: Lower debt reduces balance-sheet risk. A debt-to-equity ratio at or below 1 helps screen out companies that may be overly leveraged, making the results more resilient in tougher economic conditions.

8. quarter_revenue_yoy_growth: min 0

• Purpose: Ensure current sales are not shrinking year over year.
• Rationale: Positive quarterly revenue growth indicates the company is still expanding in the near term. This helps identify stocks with current business momentum, not just historical strength.

9. revenue_5yr_cagr: min 0

• Purpose: Confirm long-term revenue growth.
• Rationale: A non-negative 5-year revenue CAGR suggests the company has at least maintained, and ideally grown, its top line over time. This adds a long-term growth filter to complement the recent quarterly growth requirement.

Why These Filters Work Together

• They combine quality, growth, profitability, balance-sheet strength, and trend.
• The screen starts with larger, more established stocks, then narrows to companies that are profitable, efficient, growing, and not excessively leveraged.
• The PriceAboveMA200 filter adds a momentum component so the results are not only fundamentally strong, but also technically supported.
• Overall, this produces a list of stocks that are more likely to be fundamentally sound and market-approved, which is a sensible starting point for someone asking “Which stocks should I buy?”