Have you ever been in the market for a new stock and just didn't know where to start looking for your ideal match? Does the thought of tediously picking through columns of data with pencil and paper to find just the right combination of share price, P/E ratio and revenue growth seem daunting at best?
Until recently, the ability to quickly screen the entire stock market and uncover companies that met specific investment criteria was the purview of big brokerage house research departments. Using clunky mainframes, they'd chug through vast databases of stock information to generate short lists of issues. The process was both costly and time consuming, often requiring the skills of a hotshot programmer.
These days, any investor with Web access can have the same types of powerful screening tools. Even better, many of these online services are free and have simple interfaces so you don't need deep pockets or even a cursory knowledge of Java code to get instant results. We took a look at a few of the services that are free as an introduction. Let us know what you
think of these and others.
www.stockscreener.com, offers 20 basic search fields, including your choice of industry group and stock exchange. You can screen for a slew of fundamental indicators like price-to-book ratio, company size and profit margin.
The site also has detailed instructions available for those just beginning their online stock-picking adventure. Can't remember what a "current ratio" is? Just click on the hyperlink for a brief definition and helpful tips.
www.rapidresearch.com, is one of the more comprehensive free screening engines. The company's home page offers a basic selection service for beginning users with eight common search parameters. A radio button interface makes submitting your first query fast and easy.
If you're looking for more depth, click on the "Advanced Screen" link to release the full power of the site. Fully 28 search fields are available in this version, including an Industry Comparison section (my personal favorite). These fields enable you to request stocks with certain criteria relative to an industry average instead of using an absolute score.
Want to get a read on every Nasdaq-traded telecom provider with profit margins at least 10% higher than their average peer? It takes only seconds to process your request and generate a page of winning issues. The hardest part of the whole operation is finding the right industry classification among a list of over 100 nonalphabetized choices.
www.iqc.com/scan, is another site that's worth a look. Fundamental screening fields are downright spartan, with only five choices available covering the barest essentials. The real value of the engine lies in its unique price and volume search capability, which allows you to compare recent closing figures with a variety of moving averages.
If you're the type of investor that views a spike in recent trading volume as a positive indicator of a stock's short-term prospects, then you can use this site to root out likely prospects. It's faster and easier than paging through reams of charts trying to find a favorable pattern.
Whatever your methodology, online stock screening has the potential to make your investment experience more rewarding. As with most new technology, the more you use it the more confident you'll become. So fire up the browser and take these vehicles for a spin. Your portfolio may thank you, and you're sure to save money on pencil lead.
Andrew Greta, an occasional contributor to TheStreet.com, is a business student and onetime stockbroker who lives in West Lafayette, Ind.