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Bold Earnings Revisions Screen 8 Qualifying in UK

This screen seeks to identify stocks that have experienced recent revisions in the earnings estimates. Specifically, it looks for stocks that have seen one analyst revision in the last week/month, to try to see if there is an analyst moving away from the consensus. This follows research that showed "bold" estimates like this have a significant impact on share price performance. Note: that this screen on its own isn't able to only pull back revisions that are "bold" (moving away from the consensus), as opposed to revisions that are "herding" (moving closer to the consensus). This will need to be done by analysing the actual list of companies produced in more detail. To learn more about this strategy please click here »

Your Next Great Stock: How to Screen the Market for Tomorrow's Top Performers

by Jack Hough

Jack Hough outlined this apporach in his excellent book, "Your Next Great Stock" (see link above). He cites a 2003 paper, "Analyst Forecast Revisions and Market Price Discovery", which found that buying stocks following "bold" estimates increases and selling them short following bold estimate reductions beat the market by 15% a year.

This screen is based on a UK dataset. It uses the following criteria:

  • # 1w Upgrades == 1
  • # 1m Upgrades == 1
  • Rank ( Mkt Cap £m ) < 75%
  • # Brokers > 0

Results are sorted by:

  • % 1w EPS Upgrade FY2 in descending order


And limited to the first 200 Results


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Bold Earnings Revisions Screen Graphical History in

Returns

Timeframe Screen Returns FTSE 100 Outperformance
1 week 1.51% 1.80% -0.3%
1 month 1.46% 2.22% -0.8%
3 months -5.22% -1.04% -4.2%
6 months 5.15% 0.43% 4.7%
1 year 44.22% 4.63% 39.6%
2 years 46.31% 18.31% 28.0%
Since inception 77.97% 24.9% 53.1%
Annualised 27.65%

Risk

Maximum Drawdown-13.94%
Average No. of Holdings15.1
Diversification LevelGood

 Chart based on an equal weighted portfolio of max 25 stocks rebalanced quarterly. Qualifying shares below updated daily. Past performance not indicative of future returns.


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8 Qualifying in

Ticker Name Mkt Cap £m # 1w Upgrades # 1m Upgrades # Brokers % 1w EPS Upgrade FY2 Sector
Subscriber Subscriber Financials  
Subscriber Subscriber Energy  
Subscriber Subscriber Financials  
Subscriber Subscriber Industrials  
Subscriber Subscriber Consumer Cyclicals  
Subscriber Subscriber Consumer Cyclicals  
Subscriber Subscriber Financials  
Subscriber Subscriber Consumer Cyclicals  

Can't see the share you expect? View this screen as a checklist to find out why.

You should consider the results of any screening process, including this one, as candidates for further research, not as a buy list. Screening helps to narrow a search based on pre-defined criteria. It is not a substitute for independent research reflecting your individual criteria for investing/trading. Please note that the screening criteria used represents Stockopedia's interpretation of the author's investment approach and are not determined or endorsed by the original strategist.