How to Perform a G.O.A.T. Screening of Stocks

Hi there, once again, it's Tabish diving into the fascinating world of stocks. After a long absence, I'm back with a detailed guide on how to screen stocks effectively using a meticulous, hands-on approach. Whether you are a seasoned investor or a newcomer to the world of investments, this article will help you navigate through the myriad of options available. So, let's get started.

Understanding the Importance of Thorough Analysis

The best way to understand a company for future investment is by analyzing their annual reports for at least 7 to 10 years and evaluating various factors through fundamental analysis. However, due to the pressing demands of time, not everyone can undertake this extensive research. Thankfully, we have several websites that screen stocks according to our specified criteria. But the real question is: how do we utilize these resources effectively when hundreds of parameters are available?

Using a combination of fundamental analysis and pattern recognition, I've compiled over 1500 unique screeners from different websites, and I'm sharing my approach in this article. The key lies in the right combination of filters and the depth of analysis.

Adopting a Bottom-Up Approach for Comprehensive Analysis

My method involves using the bottom-up approach, which focuses on quantitative analysis through screening. Here's how you can perform a comprehensive stock screening:

Growth vs. Value vs. Quality

Begin by categorizing your search into 'growth' stocks, 'value' stocks, 'quality' stocks, or a combination of all. Utilize basic parameters like profit, sales, ROE, ROCE, ROA, ROIC, cash flow, EPS, PE, and study different parameters suggested by big gurus such as Graham, Buffett, Lynch, Fisher, Parag Parikh, Pabrai, and Prof. Bakshi.

Famous Investment Strategies and Formulas

Adopt strategies suggested by renowned investors, such as the Magic Formula or the Graham Number, and create your own personalized screeners. Obtain insights from people who are equally passionate and smarter in investing. Engage with an investor community on platforms like WhatsApp to discuss and integrate their approaches into yours. Many have developed unique formulas such as Np2eq, Cash2assets, and others.

Utilizing Multiple Screening Websites

To leverage the best of all available parameters, use different screening websites. Some of the best ones include:

A screener Trendlyne Value Research Online Tijori Finance Equity Master Ticker Tape Markets Mojo

Using different websites ensures that you take advantage of unique parameters that might not be available on others.

Creating a Shortlist of Top Stocks

After creating several screeners, list out the top 50 most common stocks from different websites. Use these four websites to numerically rank the stocks:

MarketsMojo StockAxis Marketsmith Trendlyne

If MarketsMojo doesn't provide a numeric score, create one based on the ranks. Add these scores to each stock name and rank them in descending order based on total scores.

Performing a Thorough Top-Down Analysis

Select the top 20 stocks from this list and perform a top-down analysis to understand the broader industry context and market trends. From these 20 stocks, you'll likely find at least 5 stocks that are worth long-term investment.

Unveiling the Secrets of My Screeners

This method uses the best minds in the stock market to indirectly guide your investment decisions. Bear in mind that the lists below are not investment advice, and you are solely responsible for any profit or loss arising from them. Here are some of the stocks I've identified through this process:

Category A: Overall Top Stocks

Alkyl amines IOL Chemicals Pi Industries Supreme Industries Astral Tata Elxsi Mastek Divis Labs TCS LTI Infotech Bhansali Engineering

Category B: Stocks with Strong Fundamentals and Price Growth

Alkyl amines Apl Apollo Grindwell Norton Kirl. Ferrous Navin Flourine Vinati Organics Pi Industries Tata Elxsi Divis Labs Ion Exchange

Category C: Promising Emerging Stocks

Supreme Petrochemicals Sh. Jagdamba Poly JB Chem Eldeco Housing Jyoti Resins Privi Speciality Kilpest Dynacons Avantel Bajaj Steel Vijay Solvex Titan Biotech Praveg Comm. Lux Industries Racl Geartech Adf Foods Dhanuka Agri Pix Trans. Nava Bharat Dolat Investment Elcid Investment KSolves India Pooja Entertainment Innovana Thinklabs Brightcom Themis Medicare Godawari Power Sahyadri Industries

These lists serve as a starting point for your investment journey, but it's always crucial to conduct your own in-depth research before making any investment decisions.

Thank you for reading this detailed article. If you have at least three years of experience in fundamental analysis and can understand balance sheets and financial ratios, I would be delighted to connect with you on a WhatsApp group for like-minded investors. No intraday or FNO activities are entertained in this group.

Stay invested, stay informed, and remember that investing requires patience and careful thought.

Best regards,

Tabish Nadeem