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Chroma
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I am film and television producer who writes a value investing oriented blog called Chromainvesting.com. I try to explore the Deep value orientation of Graham, with an updated perspective that includes the work of Behavioural Finance gurus such as James Montier.
  • Value Investing Ideas - Companies Passing my Custom Screens 0 comments
    Aug 24, 2011 1:40 AM
    New Chroma Investing Feature

    I promised that I was going to be adding more value investing features to ChromaInvesting.com One of them is going to be a weekly list of companies that pass a few of my custom value investing stock screeners. Each week I will highlight a different custom Value Investing screen I use when deciding to do further research on a company. This week I will highlight the 80-20 Screener;

    80-20 Value Investing Screen
    80-20  value investing Screen
    80-20 value investing Screen 8-19-11

     I have attached a screen shot of a portion of my custom 80-20 Value Investing stock screener using Stock Investor Pro screen which is comprised of the following value investing elements:

    Low Price to Book Value

    1. Price to Book ratio in the bottom 20% of stocks screened. I have documented the low price to book strategy in the past.

    High Piotroski F-score

    2. a Piotroski F score of 7 or better. ( I will be high lighting this study in an upcoming article, that will be a must read article!) This helps weed out some of the worst companies.

    Low growth in assets

    3. The annual growth in total assets should be in the lowest 20% of companies screened (currently negative double digit asset growth). Studies have shown that companies with the lowest 20% of growth in assets outperformed the market as a whole.

    Pass the Z-score

    4. A passing score on the appropriate Altman Z score. That means above 3.o for Manufacturing companies and 2.6 for other companies.- This is for downside risk protection since the Z score helps warn of potential bankruptcies.

    Good Net Current Asset Value

    5. Net Current Asset value equal to or greater than 1.25 times market cap. I am looking for companies with assets close to NCAV.

    Current Price Earnings Historically Low

    6. Ratio of current P/E to 7-10 year P/E is less than 1.  I borrowed the next two criteria from James Montier.

    Low Price to Sales

    7. Price to Sales ratio  less than 1.

    The purpose of this to aggregate multiple value investing criteria

    Value Investing Ideas

    I have not yet investigated any of the stocks on this list, but I intend to begin to evaluate at least one of the stocks a month beginning in the next couple of weeks, so please return.

    Highlights of this weeks value investing screener.

    Benchmark Electronics BHE is a new entry to this list and worth a look.

    Several of these stocks trade with almost no volume or have very very limited financial information. Some of those include Chai-na-Ta Corp. CCCFF, Elegant Illusions EILL, Sonics& Materials SIMA.

    Satyam Computers SAYCY is an Indian company that had a very large accounting scandal, so unless the issue of assets has been resolved satisfactorily, may be a false positive to passing the screen.

    Good luck on your research, if you choose to take these companies to the next level of research. If you do, please report the results here.

    Disclaimer: I do not currently have any holdings of any of the companies listed on the screener. I may without notice buy one of these equities, if I find it fits my investing needs. Nothing in this post or this website should be construed as investing advice. I am merely expressing my opinion and sharing what interests me in the value investing arena. Please do your own research.



    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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