How to Use a Stock Screener to Find Investment Ideas

There are thousands of stocks listed in the US. A stock screener lets you filter them by the numbers that matter to you, so you can go from "too many choices" to a short list worth researching. Here's how to use one well.

1. Start with your strategy

Decide what you're looking for before you touch any filters. A few common starting points:

• Dividend income: established companies with a reasonable dividend yield.
• Growth: companies with fast-rising revenue, often in technology or health care.
• Value: profitable companies trading at a low P/E ratio.
• Momentum: stocks that have been rising and are trading near their highs.

Not sure which suits you? Read growth vs. value investing.

2. Set a few core filters

On the StockEngine stock screener, begin with filters that remove stocks you would never buy:

• Market cap: many investors exclude very small companies, which are more volatile and thinly traded. See what is market cap.
• Sector: focus on industries you understand.
• Average volume: higher volume means it's easier to buy and sell at a fair price.

3. Add strategy filters

Now add the filters that match your goal: P/E range for value, dividend yield for income, or performance over the last year for momentum. The screener's presets for dividends, value and large caps are a quick starting point, and you can save your own screens to rerun later.

4. Don't over-filter

Stacking too many tight filters can leave you with zero results, or a list that only fits the past. If your list is very short, loosen a filter or two. A list of 20 to 50 stocks is a good size to review.

5. Research the short list

A screener only shows that a stock passes some numerical tests. It says nothing about the quality of the business, its competitive position or its risks. For each name you like:

• Open its stock page to review the chart, key statistics and five years of financial statements. Our guide to reading financial statements shows what to check.
• Run it through AI Insights for a 0 to 100 score and a list of strengths and risks.
• Line up your favorites in the compare tool.

6. Track and review

Add the stocks you buy, or want to watch, to the free portfolio tracker. Re-run your saved screens every few months; companies that no longer pass your filters may be worth a second look.

This article is educational and not investment advice.