Although the scanning criteria I use does get tweaked from time to time, currently I am using four different scans to add to my watchlist. Here are their criteria:

2007 Anti-Value

The idea here is to find over-valued high flyers that make either good momentum plays or very good shorts when the market turns south. It is a play on the “High PE” and “No EPS” short screens that I first started using in 2005.

Exchange: Non OTC,
Price Perf. (Last 4 Wk): Highest 20%,
Price/Book Ratio: Highest 20%,
Price/Sales Ratio: Highest 20%,
Percentage of Inst. Ownership: Highest 20%

2007 GARP

This is kinda-sorta a Marty Zweig screen, “growth at a reasonable price.” Combines a not-too-outrageous valuation with excellent growth, disallows situations where insiders are ditching shares, and requires some relative strength.

Exchange: Non OTC,
P/E (TTM Intraday): Greater than 5, Less than 30,
EPS Gwth. (Last Qtr. vs. Same Qtr. Prior Yr): Highest 20%,
EPS Gwth. (Proj. This Qtr. vs. Same Qtr. Prior Yr Last TTM vs. Prior TTM): Highest 20%,
Rev. Growth (Last TTM vs. Prior TTM): Highest 20%,
Rev. Gwth. (Last Qtr. vs. Same Qtr. Prior Yr): Highest 20%,
Net Insider Shares Bought: Highest 80%,
Price Perf. (Last 52 Wk): Highest 40%

2007 Growth

This is sort of like a CANSLIM screen. Momentum in price and earnings are the key here, valuation is unimportant. My broker’s screener doesn’t have screening for float size, but ideally I would limit this list to low-float companies.

Exchange: Non OTC,
EPS Gwth. (Last Qtr. vs. Same Qtr. Prior Yr): Highest 20%,
EPS Growth (Last TTM vs. Prior TTM): Highest 20%,
Percentage off 52 Wk High: Less than or Equal to 15,
Price Perf. (Last 52 Wk): Highest 60%,
EPS Growth: 5-Yr Hist.: Highest 20%,
Percentage of Inst. Ownership (Last vs. Prior Qtr.): Highest 60%,
Vol. (90-Day Avg.) : Highest 80%,
Percentage of Inst. Ownership: Lowest 60%

2007 Value

This is an adaptation of my traditional “value” screen. Additionally, I will remove candidates from the list for having Net Income that exceeds Operating Cash, or for having excessive inflows of Financing Cash relative to Assets. You can look at this screen and count the anomalies: Price/Book, Price/Earnings, Earnings Growth, Long-Term Mean Reversion, Financing Cash, Accruals, and two other screens for financial strength, Debt/Capital and ROA.

Exchange: Non OTC,
Book Value Growth (5-Yr Avg.): Highest 60%,
EPS Gwth. (Last Qtr. vs. Same Qtr. Prior Yr): Highest 60%,
EPS Growth (Last TTM vs. Prior TTM): Highest 60%,
Debt to Capital: Lowest 80%,
Net Insider Shares Bought: Highest 80%,
Price Perf. (Last 52 Wk): Lowest 40%,
P/E (TTM Intraday): Lowest 20%,
Price/Book Ratio: Lowest 40%,
Ret. on Assets (TTM): Highest 40%

My purpose and usage of these screens is simple; I want to identify trends and grab the stocks, and hold on loosely (but don’t let go) as long as they are trending. With the “Growth” and “GARP” stocks the plays will look a lot like CANSLIM buys; with the “Value” stocks I will either be trying to call a bottom or identify the start of an uptrend from the bottom; and with the “Anti-Value” stocks I will simply be looking for an entry and hanging on. All of this is contingent upon having the capital to take the trade, of course.

The preferred holding time is “forever” but the actual holding time will vary based on how the stock behaves, or how well I judged the beginning of the trend. I actually still have a purchase from mid-2005 on the books, Ingles Markets (IMKTA), which I bought as a “Value” and a real estate play, and has now appeared on the IBD 100 for some time. They’re a grocery store in the southeast that also has a lot of shopping center land and a dairy operation that sells to other grocers. Point is, if the stock doesn’t show signs of de-trending, I would prefer to hold it as long as it outperforms the index.