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New Quantitative Stock Ideas

Using Seeking Alpha's "Quant Rating" software to discover new stock ideas.

23 Feb

Introducing Seeking Alpha’s Quant Ratings

Back in college (circa 2014), I would use Yahoo Finance as my hub for high-level stock analysis. They had everything I needed at the time — stock charts, financials, trading data, top holders, and general stats for making informed decisions.

After poking around the internet a bit more post-graduation in 2018, I stumbled across Seeking Alpha — a website that offers all of the above-mentioned data as well as 10+ years of company financial information, transcripts, more specific headline news, commentary, and more.

For added transparency — here’s a screenshot of the first comment I made on a post back in 2019.

An incredible tool for Seeking Alpha subscribers is access to their Quant Ratings.

Essentially this is a rating between 1-5 that directly corresponds with a “strong sell” and “strong buy” recommendation. It sounds like bullshit, but after digging deeper into the contributing factors and data — it’s compelling.

According to their website…

Quant Ratings are an objective evaluation of each stock based on data, such as the company’s financial statements, the stock’s price performance, and analysts’ estimates of the company’s future revenue and earnings. Over 100 metrics for each stock are compared to the same metrics for the other stocks in its sector.

Case Studies

Below are a few examples of SA’s Quant Ratings being very correct.

  • Peloton (PTON):

Initiated a “Sell” rating at $100 / share and a “Strong Sell” rating at $86 / share before the stock began trading much lower.

—

  • Builders FirstSource (BLDR):

Initiated a “Strong Buy” rating at $52 / share before the stock began trading +45% higher over the coming year and a half.

—

  • Build-a-Bear Workshop (BBW):

Initiated a “Strong Buy” rating at $8 / share before the stock began trading +150% higher over the coming year and a half.

Been ‘punching air’ for months that I didn’t follow along with my friend Chris Camillo’s Build-a-Bear conviction!

Top 10 Quant-Rated Stocks Today

I don’t share these with you so you can ‘copy & paste’ a trade — but instead to run new names by you. Hopefully it inspires you to do your own research as to why these stocks are highly-ranked right now.

As you could expect with many headlines (most notably the Russia-Ukraine invasion), the massive trend has been in the energy / oil industry.

  1. Obsidian Energy (OBE)

  2. Grindrod Shipping (GRIN)

  3. Crescent Point Energy (CPG)

  4. Marathon Oil Corporation (MRO)

  5. Euroseas Limited (ESEA)

  6. Petrobras - Petróleo Brasileiro (PBR)

  7. Gran Tierra Energy (GTE)

  8. Build-A-Bear Workshop (BBW)

  9. Alliance Resource Partners (ARLP)

  10. Exxon Mobil (XOM)

Other high-ranking stocks include Chevron (CVX), Pfizer (PFE), Ford (F), Qualcomm (QCOM), Ulta (ULTA), and Taiwan Semiconductor (TSM).

Top 5 Quantitatively Ranked Stocks in my Own Portfolio

As many of you share similar holdings to myself — below are the top 5 according to SA.

  1. Advanced Micro Devices (AMD)

  2. Qualcomm (QCOM)

  3. Google (GOOG)

  4. Builders FirstSource (BLDR)

  5. Analog Devices (ADI)

Google and Builders FirstSource have both high Quant Ratings and high Wall Street sell-side analyst ratings. Best of both worlds, perhaps?

What to expect going forward

I love sharing useful tools and resources with you — and Seeking Alpha is definitely one of them. Their website allows you to log in to your online broker and sync your holdings with their data, ensuring you never miss a beat.

It’s $29 / month, but I’ve found it to be more than worth it.

Reply to this email or shoot me a text (615) 802-9495 and I’ll introduce you to my friends who work there. I’m confident they’ll be able to set you up just fine. 

I’d love to continue sharing Quant Ratings to help with your investing journey — just let me know if this is something you’d want!

Disclaimer: This is not financial advice or recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

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