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How to Find Investment Ideas with Free Stock Screeners and Websites

Today I am going to show you some easy ways to find great investment ideas. Using free stock screeners, financial websites, podcasts, and many more to find fantastic investment ideas is the start to building a great portfolio.

These resources can help you grow your wealth, and best of all, they are all free!

Today we will explore:

  • Free stock screeners
  • Financial websites
  • Cloning guru portfolios
  • Podcasts

Ok, enough chit-chat, let’s dive in.

Free Stock Screeners

In the never-ending quest for finding stock investment ideas, stock screeners are the number one source of investment ideas, at least in my world.

Using a screener to find ideas to begin to investigate is the first step in my process of finding an idea I want to buy with my investment budget.

Today we will discuss some of the screeners that I use, as well as others I have investigated along the way to settling on the few that I use.

My suggestion is to experiment with them all and try them before you settle on the ones that best fit your needs. At this stage of the game for me, I focus on the ones that limit my costs, the leg work of investigation is on me, but I try to limit spending money on researching ideas to help put my money where it needs to go, and that is my investments.

When using screeners, I try to follow the same process with each, not all of them will allow you to adapt them to your investment process. For example, I like to use fundamentals to begin my screening processes such as a low PE ratio, or low debt to equity. These items are critical to me, as I don’t want to find an excellent possible investment, and the company is drowning in debt.

The trick with stock screeners is to use them to eliminate ideas that won’t fit your investment criteria, if you don’t do this, the number of choices will be overwhelming, and the chances of analysis paralysis will compound.

In today’s post, I am not going to discuss in depth the fundamental metrics I use to screen for stocks precisely, if you are interested in learning more about those metrics, please go here for a fantastic starter on those metrics.

Ok, let’s look at our first screener.

Finviz

I have been using Finviz for years, and it has remained unchanged. It has multiple advantages, and it is effortless to use. Like most websites, they do have a premium aspect to it, but I have found the free elements of the site more than sufficient for my process.

Every Monday for about six years, I visit the Finviz site and set up my screen and look for investment ideas, not every session is successful, often there are the same companies. But part of the process is to continually have ideas brewing in the chance that something might present itself.

Finviz provides me the ability to alter the fundamentals that I screen with; for example, if I am having trouble finding ideas, I might expand my PE ratio from below 20 to less than 30, which opens up more possibilities.

Other options that I like a lot are the ability to filter out companies outside of the US. You can also decide what kind of market cap companies you want to screen, as well as dividend yields. The list goes on and on.

The dropdowns on the site give you more control than some screeners which operate with predetermined screeners that don’t allow alterations, that is one of the features I like best. But it is constraining in that you aren’t able to put in specific numbers, which for my use is not a big deal. I am using Finviz to find ideas, and then I will spend the time looking at specifics.

Finviz also allows you to set up portfolios that you can track on the site, which would enable you to have wishlists set up that you can follow.

Again all of the features I am mentioning are free; you can register if you like, which gives you more functionality, still all for free. They do have an Elite plan for the more serious traders.

If you can’t tell, I am a big fan of Finviz, and for my use, as a tool to find investment ideas, it is the best.

Schwab Brokerage

If you aren’t already using your brokerage account screener, I encourage you to take a look. I frankly was not a big fan of Tradeking’s screener back in the day, and Ally didn’t improve on it.

Since I switched to Schwab, I have been using their screener that is included with your brokerage account, which is free to open and trade with, now that trading fees have gone the way of the dodo bird.

As with Finviz, my Schwab screener allows me to screen using the fundamentals I like to use. It also allows creating different watchlists, and best of all, because it is linked to my brokerage account, once I find an actionable idea, then I can buy it directly from the report, pretty cool.

I have recently started using this tool to widen my net in an effort to find more investment ideas.

Again, all brokerage accounts will offer this service; some will be better than others. I have great things about Fidelity’s screeners, as well as TD Ameritrade’s.

I am receiving zero financial compensation for any of these suggestions, so please use whichever fits best for your investment process.

Stock Rover

Another service that was mentioned over and over in my research for this article is Stock Rover. Stock Rover requires a registration to use, but it is free as well. They do have a premium service for your further research if you so choose.

I have just started delving into their service, and I like it quite a bit, they have some cool predetermined screens such as the Buffetology, which is right up my alley.

If you hover over any of the sections, it will give you more detail on what the screens entail and what kind of fundamentals they consider when setting up the filters.

The few flaws I see for me, and the lack of ability to filter out companies from other countries, I like to focus on my home country, not necessarily for any patriotic reasons, mostly because that is what I know and am comfortable buying.

The other downside is the inability to screen for specific fundamental ratios such as debt to equity, PE, PB, and so on, but those are minor issues.

Again the focus of the screeners for me is to find potentially undervalued companies for me to research, I am not using these screeners as vehicles to find companies to buy, and please don’t use them as such. Instead, they should be part of your more extensive process.

52 Week Lows

52 week low is as simple as it sounds; we are looking for companies that are trading at their 52 week low.

These types of lows are considered a technical indicator and are very common for day-traders to use. But for value investors, it can be a place to mine for undervalued companies. I found this idea from Mohnish Pabrai, as it was a tool he used at one point to find investment ideas.

The idea is that the company is trading at the lowest price it has sold for 365 days, it refers to the previous day’s closing price.

Click to zoom

I use the site MarketBeat to find the 52-week lows, and this again is part of the process I use every Monday to find investment ideas. There are several other websites that offer this screening, such as Yahoo Finance, that are decent.

The idea behind looking for companies trading at 52-week lows is that we are trying to find a company that has been beaten down in price over the year and has fallen out of favor with Wall Street.

That doesn’t necessarily mean that the company is terrible, but it could also mean that as well. Take financials, or the oil industry right now. They are getting beaten up because of low-interest rates and meager oil prices and lack of demand.

Not every company you run across on this list will be a winner, in fact, most will not be, but it is an excellent opportunity to find undervalued companies that might be out of mind.

And to me, if it is good enough for Mohnish Pabrai, then it is good enough for me.

Cloning Guru Portfolios

Cloning or coat-tailing the investors we look up to is one of the more practical aspects of investing. Warren Buffett admits in his early days to copying many of Ben Graham’s methods and stock ideas.

Using the method of cloning other gurus portfolios is a quick easy way to build your portfolios. Pluming their ideas is a great way to find companies to investigate.

Many of the more famous investors have extolled the benefits of cloning, such as Buffett, Charlie Munger, and Mohnish Pabrai.

Pabrai is probably the most unabashed champion of this idea, as he has followed Munger’s investment ideas for years and used his influence to find great investments.

Keep in mind that buying a company just because your favorite investor bought it can be hazardous if you don’t understand the reason for the purchase.

What I am suggesting, as Pabrai has many times, is to use our gurus as sort of an investment screen, and then doing our research on top of their suggestions.

The type of screening we are talking about works best for value investors, when looking for companies to investigate it is best to look for gurus that have a long-term strategy and are not trading in and out of companies quickly, the main reason for that is taxes. Keeping fees down is essential, and lessening your capital gains by constant selling will improve your long-term success.

Studies have shown that shamelessly cloning some of the more famous value investor portfolios based on their 13F filings has been successful over the long-term.

To find out what your favorite guru is buying, there are several places you can look.

One is to look to their 13F filings, which are released every quarter, these filings list their current portfolios as of the filing dates. These are free to the public and a great source of information.

Other options include Whale Wisdom and Insider Monkey.

Another drawback to this idea is the fact that the information you are acting on can be up to 45 days old, as they are filed 45 days after the end of the previous quarter. That means that the company you are interested in could have dropped or risen substantially in those 45 days.

I like to use this idea of cloning as a source of investment ideas, not necessarily to build a portfolio, although there is some validity to that approach.

Insider Buying

In today’s stock market, with the chaos that is all around us, finding insiders that are buying up their companies’ stock is not only reassuring but also an indication that they feel the company is undervalued currently.

Thinking about who knows their company best, anyone who is intimately involved, such as the CEO, CFO, COO, and so on, would be a great indicator that they feel the company is much more reliable than Wall Street may indicate.

Remember that price does not equal value, and if a company or sector has fallen out of favor, that doesn’t’ mean it has poor prospects or is going out of business. It may mean that something fundamentally wrong is going on, such as low-interest rates, or low demand for oil.

Using that tidbit of information is a great place to look for potential companies to research.

My favorite website to look for insider buying is gurufocus.com; that is one their calling cards are tracking what gurus are doing, as well as tracking any insider buying or selling of a shares by upper management.

The SEC requires form 4 to be filed in the case of any insider buying or selling, and you can receive these alerts by signing up for them on a company’s website. In fact, you can be alerted for any SEC filing from that company through the website.

Financial Websites

Another great source of investment ideas is your favorite financial websites. On those sites, you will find great information on the financials of a company, along with screeners there too.

But another idea is to look at companies that are written about, for example, one of my favorites is Seeking Alpha. Seeking Alpha has zillions of articles written on just about every company. Many of them are written from a buy-side point of view, but there is the sell-side represented as well.

For example, Tesla is a hot topic on the site, and you will see a wide range of views about the company there. Along with the excellent analysis you can find from the authors, there are some nuggets you can plum from the comments to these articles as well.

For example, I was reading through the comments you can find other thoughts on the company that the analysts didn’t cover, as well as other suggestions of other companies to investigate.

An article that I wrote about Chubb, an insurance company, had a suggestion of looking deeper into Prudential, which I did.

By looking at the number of articles written about a particular company can give you ideas of possible research targets.

In addition to all the great analysis, you can also find financials for each company, and my particular favorite for additional investing ideas comes from the Peer tab, which lists other peers to the company you are investigating.

Exploring peers to the company you are researching can lead to other great opportunities.

For example, when researching Schwab (SCHW), I can also investigate its peers to see if they might be more promising than Schwab.

As you research any company on Seeking Alpha, you can simply click on the Peers tab to get new companies that might offer an opportunity.

Gurufocus, which I mentioned above, also offers many excellent areas to cull for investment ideas. Among them are the guru sections that follow just about any investment manager you can think of, beyond the more famous names such as Buffett, Pabrai, Dalio, and many others.

There is also a section on insider buying and selling, which we discuss above, there is an even a stock screener which is quite an in-depth, and offers extensive metrics to choose from, with the ability to select specific numerical targets to screen.

I am a massive fan of this site, and I use it in conjunction with SEC.gov, Seeking Alpha, and quickfs.net.

Podcasts

Podcasts can be an excellent source of entertainment. But they can also provide investment education, as well as investment ideas.

Take, for example, Motley Fool Money, which is released weekly and provides an overview of the markets every week, as well as some commentary on particular sectors and or companies they think are interesting.

Another great podcast is The Investors Podcast run by Preston Pysh and Stig Broderson. Both Preston and Stig are tremendous Buffett fans and are incredibly entertaining; they are also incredibly intelligent and provide fantastic market commentary. They also have lately been discussing intrinsic value with guests pitching different companies.

A great source of investment ideas, plus educational, are the mastermind roundtables they do once a quarter. They invite several guests besides themselves, to discuss different investment opportunities. One of my favorite roundtable guests is Tobias Carlisle, an incredibly smart value investor that has some great views on companies that I connect with, a great resource.

The last podcast I would remiss if I didn’t mention is the one I do with Andrew Sather, The Investing for Beginners podcast. Andrew and I discuss many different subjects relating to investing from a beginner’s point of few. Along the way, we both try to use real companies in our examples to help put the information in context. Plus, we come at it from the angle of a beginner and try to talk in a language we can all understand.

Using podcasts as an opportunity to find investment ideas is an underutilized tool. I have seen many ideas for companies that I would have never considered if I hadn’t heard about them on a podcast.

Final Thoughts

As we have seen, there are multiple areas available to find investment ideas. Using free stock screeners is one that I use on a weekly basis; it is part of my weekly process and works for me.

The free stock screeners are probably the best source of ideas I have found, but all the above ideas are great resources to add to your process, which is something that I have done over the years.

You will not find the next Amazon every single week; the trick is to create a routine and stick to that routine. Once you discover something interesting to you, then you can begin the research process.

Under no circumstances should you buy a company solely on a screener, recommendation from a Seeking Alpha article, or podcast suggestion.

Always use these ideas as a springboard for your own analysis, whatever that may entail.

That is going to wrap up the post today.

As always, thank you for taking the time to read this post, and I hope you find something of value along your investing journey.

If you have any questions or if I can be of any further assistance, please don’t hesitate to reach out.

Until next time.

Take care and stay safe,

Dave