Value Investing / Main Index / previous

January, 2017

FIVE FINE MOTLEY FOOL FILTERS
by LARRY

The investment related website, Motley Fool (www.fool.com), offers a wide variety of tools and supports for the individual investor, such as a stock screener, educational offerings, a set of fruitful discussion boards (for instance "Mechanical Investing," and "Saul's Investing Discussions"), fee-based investment services, recommended stocks, and a rating system determined by member assessments, the most successful of whom are included in the site's "all stars" category, their suggestions then having more weight because following their recommendations has a greater likelihood of panning out well.


I have been following Motley Fool for close to two decades now and find that using their screener to winnow the field of possible stock purchases using five criteria is more useful than many other methods. These five are:

  1. 25 or more All-Star outperform recommendations;

  2. 4-5 CAPS stars;

  3. 26-week price change of +10% or better;

  4. Price to book value and price to sales both in the range 0.1-3.0;

  5. Market capitalization $25 billion or below.


If the screen results are too numerous, the stocks that remain after these above filters may be further reduced by limiting the candidates to those with 5 CAPS stars, positive return on equity, debt to equity 0.99 or below, cash per share of $1 or more, and some dividend.

At the table are a few stocks that recently met all 10 criteria and were easily found via the Motley Fool screener.

These are in general smaller-capitalization stocks with good potential and value that have upward price movement in their favor. Such securities typically perform better than the market averages. Once one has gradually acquired a portfolio of, say, 25 such assets, maybe buying one a week or one per month, he or she can simply replace the weakest one then held with the best available new candidate that meets above requirements.

Best of good fortune with your own investing researches, strategies, and success.



NameTicker
Symbol
Recent
Price
Price Chg.
Last
26 Wks.
DividendMarket-Cap.P/BKP/S
FutureFuelFF$13.36+16.68%1.79%$586 million1.362.68
The Gorman-Rupp Co.GRC$31.09+11.00%1.48%$811 million2.742.10
Inter Parfums, Inc.IPAR$31.65+15.90%2.07%$984 million2.531.95
Resources Connection, Inc.RECN$17.10+15.00%2.55%$507 million1.800.86
Steelcase, Inc.SCS$16.33+12.80%2.95%$1.92 billion2.650.64


DISCLAIMER

Larry is not a professional. Don't take him seriously!

Actually, the investment article provided here is for general information only and should not be considered as professional advice, a solicitation to buy or sell any security, or the Word of God. Investors are encouraged to do their own research while considering their personal goals and circumstances, or consult their own professional financial advisors, before making investment decisions. Neither Larry nor LARVALBUG will be liable for any losses sustained by any visitor to this site.

(Disclosure statement: Larry and Val have holdings in some of the suggested assets but do not "make a market" in any of them and do not derive any direct benefit from recommending them, except perhaps for a bit of smug self-satisfaction.)



Value Investing / Main Index / previous