Revealing the Snapshot Opportunity Score

Dividend SnapsotThe Snapshot Opportunity Score is my proprietary formula for assessing the purchase timing of a stock. It’s a great technical indicator to see if a stock is ripe for purchase compare with others in its sector or my list. It’s not a score that identifies the long term value of a stock as that decision relies on a thorough evaluation of the business. Once the stock is on my list, it has passed my evaluation for a future consideration.

Investing can be quite simple in a way. I have a list with list of companies I would be happy to own and I just ignore all the thousands other companies. I use mySnapshot Opportunity Score to identify the stocks priced right while focusing on the sectors I need to buy into based on my diversification criteria.

Related: Managing the list

I use mySnapshot Opportunity Score to help assess the purchase timing of a company. As you probably know, I manage a list of stocks in a spreadsheet with all the live Google data updating the score continuously. It’s really simple once it is setup. I even shared a Google Spreadsheet Template.

Related: How To Screen Dividend Stocks

The Snapshot Opportunity Score

I don’t have a problem sharing the simple formula thus giving away my proprietary concept. Finding the right numbers is where the magic is. What I have realized over time is that you cannot have number targets that are too aggressive because you eliminate a lot of options. Some numbers also need to be in line with the sectors so the target in some cases is based on sector averages.

I do have historical data for dividends and EPS and in reality, it’s often what you pay for since it’s a manual process and a bit time consuming.

The Technical Ratios:

  • P/E : Relative strength compared with sector.
  • 52 Week Range : The lower in the range the higher the score for an entry point
  • Yield :Relative strength compared with sector.
  • Payout Ratio : Compared against 10 year average when available
  • Market Cap : Bonus multiplier with a target of $20B or more (+/- 10%). I normalize it between 0.9 and 1.1 and use that to multiply my previous total of the first 4 criteria.
  • Dividend Aristocrat Multiplier : A dividend aristocrat receives a multiplier for its historical performance.
  • Dividend Growth: 10 year tracking
  • EPS Growth: 10 year tracking

Readers: How do you find your next purchase?

One Response to "Revealing the Snapshot Opportunity Score"

  1. There was a time when I invested in individual stocks and I still have several in my portfolio. Now I find it easier and more pragmatic to buy low cost index and dividend funds. When I did buy
    1) pe had to be in line with industry piers and never over 20
    2) had to be a dividend payer with the history of raising divivends
    3) had to be a steady Eddie – been in business for a long time…
    4) no single product companies (Krispy Creme)

    If the mutual fund industry with all their pros can’t beat the market over time I just decided I or anyone else likely couldn’t either…

    Reply

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