It’s often said that all investing is value investing. That’s hard to deny. For any company that generates cash, or hopes to at some point, an estimate of its so-called intrinsic value can be calculated based on all future expected cash flows. Against such estimates, investors can judge whether to buy or sell shares on valuation grounds.
But in reality, outside the professional sphere, the heroic acts of forecasting and assumption that are necessary to achieve such valuation feats are well out of most people’s reach and comfort zones.
Fortunately, there are more down-to-earth strategies that are far easier for private investors to apply when searching for winning shares, and stock screens can be a massive help. These strategies are built on enduring evidence about how both people and stocks behave rather than a goal of forecasting omnificence.