Please provide CFO/PAT and CFO/EBITDA in the Cash Flow section.
1 Like
Are you using any addon, as I cant see last 4 rows in my login?
Hi
On screener, there is one screen featured on the main page under âresultsâ, by Satya Prakash, called âBest of latest quarterâ. Following ratios have been used to create this screen:
Net Profit latest quarter > .5 AND
YOY Quarterly sales growth >= 0 AND
Other income latest quarter < Net Profit latest quarter * .5 AND
Market Capitalization < 40 * Net Profit latest quarter AND
Tax latest quarter > .10 * Net Profit latest quarter AND
Debt < 4 * Market Capitalization AND
Market Capitalization > 20
Can anyone help me understand why these criterion lead to âbest quarterly resultsâ.
Thanks
2 Likes
I will try to dissect the screen based on my understanding.
This screenâs purpose seems to be identifying fundamentally strong companies that have shown recent quarterly performance strength, while filtering out low-quality and over-leveraged stocks.
- Net profit < 0.5
This is to eliminate companies with negligible or negative profit. Consider it as a minimum profit threshold to ensure that only real, functioning, profit-making businesses are considered. - YOY Quarterly sales growth >= 0
This checks whether revenue has grown or remained stable YoY. Flat or positive sales growth signals that demand hasnât declined. It removes companies with declining topline. - Other income latest quarter < Net Profit latest quarter * .5
This ensures at least 50% of the profit comes from core operations, not from non-operating items like interest or asset sales. If most profit is from âother income,â earnings may not be sustainable. - Market Capitalization < 40 * Net Profit latest quarter
This is a valuation filter, similar to checking if the company has a reasonable Price-to-Earnings (P/E) ratio, based on its latest quarterâs profit (not full-year). - Tax latest quarter > .10 * Net Profit latest quarter
This is to avoid companies that show profits but pay little or no tax. It confirms the profit is real, not accounting trickery. - Debt < 4 * Market Capitalization
This condition screens out debt-heavy businesses or those in financial distress. A company with debt more than 4Ă its market cap is heavily leveraged, which increases risk. - Market Capitalization > 20
This is to exclude microcap or illiquid stocks, where there is a high risk of manipulation.
5 Likes
There are two ratios that I think fits in the above criteriaâ
-
Cash Conversion ratio- Cash flow from operations/Net profit
If this ratio is more than 0.75 then it means that profits are backed by real cash movement. -
Accrual ratio- (Net profit -CFO)/ total assets
A high accrual ratio means earnings are not cash backed. A red flag.
2 Likes
Thanks
How high is a high accrual ratio?
It depends but <0.2 is ideal, beyond 0.3 means a significant part of profit is non-cash.
1 Like
A bit obvious, but sharing for those who havenât thought about it:
You can share the link of companies you want to compare to gemini and query comparisons. Works really well. Not just ratios, and numbers, but also corporate actions, board meetings etc. You can also download the comparisons directly onto a sheet.
1 Like
But how come a snapshot of just 1 year or 1 quarter can tell this company is fundamentally strong. What i still see, screener lacks is backtesting over a few year horizon and then share based on input criterion selected to screen the companies, following are the list which have consistency performed every year. Since 1 quarter data can be deceiving.
1 Like
Yes, thatâs why the screen is called, âBest of latest quarterâ. This is indeed a limitation and it takes a good amount of time to research about companies further. These days I download the statements from Screener and use Gemini/ChatGPT for further analysis.
1 Like
Thatâs a good way of doing it now adays LLM models based Chat GPT or Gemini is good tools to analyze and research on the data. Have you come across any tool apart from screener which does the back test of your strategy or companies you are interested in?
1 Like
Trendlyne paid tier includes backtesting. Donât know about any other.
Is there a way i can write a query of stocks to see price moved from above to below compared to dma50 & dma200 etc.
What i expect is something like
Current price < DMA 50 AND
Previous day price > DMA 50 previous day AND
DMA 50 previous day >DMA 50
But i dont see any ratio to see âprevious day priceâ. Is there any equivalent to see simple bearish cross where a price moves below a dma.
May be you can use âReturn over 1dayâ or Return over 1week" to achieve the same.
1 Like
You can use some other platform like Streak/ChartInk for technical filters. Screener is more suited for fundamental screens.
Trendlyne is good one to start with, I have used it but one thing which I am not confident is on the backtesting modal, as I have seen it gives false positives. Have you ever tried FidelFolio ai backtesting features?
No, I havenât. How is it?
Its good to start with, gives more details around how your investment strategy has worked over the years. Only shortcoming is you cannot do backtesting on single company, but you can try to test your investment rule.
1 Like
Fidelfolio Investment is an investment firm that has made its backtester tool open & free. The tool allows you to test your screenerâs historical performance also apart from screening.
Backtested results can answers questions on your screener like:
- Current & historical portfolios
- Average return
- Risk - volatility, drawdown
- Range & probability of returns
3 Likes