Have you ever heard of CAN SLIM? It is a checklist for selecting stocks before their biggest gains. According to American Association of Individual Investors (AAIA), between 1998 to 2008, a portfolio traded according CAN SLIM principles have gained 1,315% versus a loss of 6% in the S&P 500.
You can learn more about CAN SLIM from William O’Neil book, How to Make Money in Stocks: A Winning System in Good Times and Bad, Fourth Edition
Today, we would like to run stocks screener on the first two letters of CAN SLIM, i.e.:
- C: Current Earnings. Current earnings should be up at least 25%.
- A: Annual Earnings. Annual earnings should be at least 25% in each of the last three years. Annual return on equity should be at least 16%.
Due to limitation of Yahoo Finance’s stocks screener as well as to keep the number of stocks below 100, we have to modify the criteria a little bit, i.e.:
- Instead of using the last 3 years annual earnings, we use the last 5 years.
- Market capitalization should be $500 million or more because we don’t want to speculate on micro-cap stocks.
- Profit margin should be at least 10%.
- Average daily volume should be at least 100k because we don’t want any illiquid stocks.
We have created a Google Docs that contains the complete result of this stock filter. Click here to view the complete result.
