Set Criteria for Discounted Price

Set Criteria for Discounted Price5. Set Criteria for Discounted Price To find stocks at discounted prices, you need to focus on metrics that indicate that a stock is trading below its intrinsic value or historical valuation: Price-to-Book (P/B) Ratio: A P/B ratio below 1.5 can indicate that a stock is undervalued. Example filter: P/B < 1.5 Price-to-Earnings (P/E) Ratio: Stocks with a P/E ratio lower than the industry average or historical P/E ratio can be considered discounted. Example filter: P/E < Industry P/E Discounted Price Relative to Historical Values: If a stock has recently fallen in price but continues to show strong fundamentals, it could be a discount opportunity. Example filter: Price < 10% of 52 week high PEG Ratio (Price-to-Earnings Growth Ratio): A low PEG ratio (below 1) indicates a stock is undervalued relative to its earnings growth rate. Example filter: PEG ratio < 1 6. Combine Filters to Create Your Screen Once you have selected the desired criteria, combine them into a single screen. Here’s an example of a stock screen for long-term investments at a discounted price: EPS growth (5 years) > 15% ROE > 15% Debt to equity < 1 Operating Profit Margin > 15% Free Cash Flow > 0 P/E < 20 P/B < 1.5 Dividend yield > 2% Price < 10% of 52 week high 7. Apply the Screen After entering the filters, click on "Show Results" to apply the screen. This will display a list of stocks that meet the criteria you’ve set. 8. Review the Results Analyze the companies that appear in the results. Look at their historical performance, fundamentals, and any recent news or developments. Check for consistency in earnings, growth potential, low debt, and whether the stock is undervalued based on its P/E, P/B, or other valuation metrics. 9. Conduct Additional Research Even though the screener helps identify stocks with strong fundamentals and undervalued prices, always conduct further research into each stock. Look at: The company’s industry Management and leadership Long-term competitive advantages (e.g., brand, patents) External factors that might impact future growth 10. Track and Monitor the Stocks Once you’ve identified potential investments, monitor their performance regularly. Screener.in allows you to track stocks and set alerts based on price movements or other factors. Example of Custom Screen on Screener.in: Here’s an example of how to set up a screen: Go to "Screener" on the website. Click on "Create a New Screen". Add the filters mentioned earlier (e.g., EPS growth > 15%, P/E < 20, P/B < 1.5, etc.). Save the screen and view the results. By combining these criteria, you can identify companies that are fundamentally strong and currently undervalued, making them suitable candidates for long-term investment at a discounted price.

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