Unsettled market conditions in recent months have naturally put pressure on the overall performance of the GuruScreen strategies tracked by Stockopedia. Even so, the movement of stocks in and out of these screens still offers a view of those that may be worth looking at further.
Slater’s Zulu Principle picks up Pace
Shares in set-top box maker Pace (LON:PIC) jumped by 50% to 469p between January and March this year but have since dropped back to around 312p. In recent days the stock has made its debut appearance on the Jim Slater Zulu Principle screen. With a 1-year return of 17%, this is one of the best performing growth screens tracked by Stockopedia.
Pace has a modest forward P/E ratio of 9.6x and rolling earnings growth of 22.7%. Together, those factors produce a price-earnings growth rate (Slater’s PEG) of 0.43 - well below Slater’s 0.75 threshold. In other words, Pace could be seen as moderately priced in the context of its earnings growth forecasts. Analysts have certainly been attracted to it, with 2014 EPS forecasts notched up from 0.44 US cents to 0.52 cents over the past 12 months.
One note of caution is that Pace’s 1-year relative price strength against the market is currently 1.0%, which means it just scrapes onto the Slater screen. Any lower and it would be underperforming the FTSE All share, and by his criteria it could be out.
Shoe Zone picks up momentum
Discount footwear chain Shoe Zone (LON:SHOE) was among a number of retailers that IPO’d earlier this year. Unlike peers such as Boohoo.com and Pets at Home, shares in Shoe Zone now trade at a premium to its 160p float price. But with 55% of the stock still in family hands, there is a question mark over liquidity - certainly the price hasn’t moved much until recently. However, a rise this week of 12.5p to 190p has catapulted the £95 million market cap stock onto the Value Momentum screen.
Like the Jim Slater Zulu Principle screen, Value Momentum uses the PEG as a means of finding cheaply priced stocks with growth potential. The growth and value traffic lights on the Stock Report look promising, and Paul Scott mentioned in June that the company shows the signs of a strong…
