How to use Finviz to find dividend stock ideas

There are so many stocks to invest, but how you find the best ones?

The stock screener is a service that has a large quantity of data collected from individual stocks. The user can do searches by limiting the number of criteria’s, to find a certain type of stocks. Finviz is a tool that I use to find dividend stock ideas. I don’t use Finviz as a decision-making tool, instead, I filter out strong candidates that could have potential. From this small group of stocks that meet all the qualities, I hand pick some and do a closer inspection of the companies. I list some settings that I have found useful when searching good dividend stocks from Finviz, that have long-term ability to pay dividends.

The “Descriptive” Tab

The “Descriptive” tab has the basic options for the stocks. Here I choose the “Dividend Yield” as Over 3%. Too high dividend yield can be an indicator of risk. Usually, there is a reason for high dividends, the stock may have a dip or the dividend is way too high to have support from the financial base of the business. The “Analyst Recommendations” option “Hold or better” rules out all the worst stocks. In Finviz the analyst recommendations are from 1= “Strong buy” to 5= “Sell”, so “Hold or better” only includes stocks from classes 3  to 1.

The “Fundamental” Tab

The “Fundamental” tab has financial indicators. The option “P/E” or Price-Earnings Ratio can be used to rule out all the stocks that are overvalued. If the P/E is high, it may mean that investors have high expectations. Low P/E may instead show an undervalue or the company has been doing well for a longer period of time.

Long-term dividend growth stock needs to have stability. “Institutional Ownership” is good to set 50% cause the institutional investors usually are the long-term investors with the intention to keep the stock. Institutional investors are more steady investors compared to individual investors, that sell the stock easily if there is storm ahead.

Less the company has a debt the better, profitable companies that are making a solid record and can finance their own business, usually, have cash to pay rising dividends. That’s why I set the “LT Debt/equity” under 1. If a company has all the things in order it does not pay all the profits in dividends, if the “Payout Ratio” is over 100% it means that business gives more money out than comes in. Reasonable payout ratio also means that there is still resources to raise the dividend even further in coming years. I use under 60% payout ratio.

That’s it. With these few settings in Finviz, it’s possible to get a nice listing of stocks that have potential. You should not make investment decisions only relying on Finviz. Instead, Finviz is a good tool to seek new investment opportunities or get ideas what is available in the markets.

Link to the screener with my options

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3 thoughts on “How to use Finviz to find dividend stock ideas

    1. Thank you for the message. Well timed question, that gave me some thinking and attracted my interest. I’m not an expert on options. Using options always involve some level of a speculation. I try to base my investing more on a long-term view and avoiding risk by investing on things that are stable, like Coca-Cola.

      But what I know about covered calls, it should be the lowest risk form of using options. It can be a better way to protect your portfolio than selling stocks to gain lower risk, there are also benefits, like avoiding taxes. The options are demanding and you have to be sure what you are doing.

      1. Thanks for quick reply.

        I agree, you need to know what you are doing with options. I am actually developing an online covered call screener. The goal of the project is to help value investors use options to reduce risk and increase returns.

        I am looking to get feedback and find folks to do collaborative blog post. If you interested let me know and we can talk more via email. Thanks again for the response!

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