Stock screeners are powerful tools that help investors filter thousands of stocks to find those matching their strategy. For value investors inspired by Warren Buffett’s principles, the right screener settings can uncover undervalued gems with strong fundamentals. Drawing from expert insights and current market trends, this article outlines the top five stock screener settings to help you build a winning portfolio in 2025, tailored for value investing in sectors like consumer goods, healthcare, or technology.
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1. Price-to-Earnings (P/E) Ratio Below Industry Average
Why It Matters: The P/E ratio compares a company’s stock price to its earnings per share, indicating whether it’s undervalued. Buffett seeks stocks with low P/E ratios relative to their industry, signaling potential bargains. In 2025, with market volatility expected, this metric helps identify stable, undervalued companies.
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- Set P/E ratio to “less than industry average” or a specific range (e.g., 10–15).
- Filter for companies with consistent earnings over 5–10 years to avoid one-off low P/E stocks.
- Example: Screen for healthcare stocks with P/E below 15, like Johnson & Johnson, which may trade at a discount compared to tech-heavy peers.
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Platform Tip: Use Yahoo Finance or Finviz to compare P/E ratios against sector averages. But the best screener is TradingView
2. Return on Equity (ROE) Above 15%
Why It Matters: ROE measures how efficiently a company uses shareholder equity to generate profits, a key Buffett metric for assessing management quality. High ROE (above 15%) indicates strong profitability, crucial for 2025’s competitive markets.
How to Set It:
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- Filter for ROE greater than 15% over the past 3–5 years.
- Combine with a market cap filter (e.g., >$1 billion) to focus on established firms.
- Example: A consumer goods company like Procter & Gamble with a consistent ROE above 20% signals reliable performance.
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Platform Tip: StocksToTrade or Seeking Alpha allow ROE filtering with historical data for accuracy.
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3. Debt-to-Equity Ratio Below 0.5
Why It Matters: Buffett avoids overly leveraged companies, as high debt increases risk, especially in 2025 with potential interest rate hikes. A debt-to-equity ratio below 0.5 indicates financial stability.
How to Set It:
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- Set debt-to-equity ratio to 0–0.5.
- Pair with a filter for positive free cash flow to ensure liquidity.
- Example: Screen for utilities or consumer staples with low debt, like Coca-Cola, which aligns with Buffett’s preference for stable cash flows.
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Platform Tip: Benzinga Pro offers robust fundamental filters for debt metrics.
4. Dividend Yield Between 2–5%
Why It Matters: Buffett loves dividend-paying stocks for their steady income and compounding potential. In 2025, dividends provide a buffer against market dips, especially in defensive sectors like utilities or healthcare.
How to Set It:
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- Filter for dividend yields of 2–5% to balance income and growth.
- Add a payout ratio filter (below 60%) to ensure sustainability.
- Example: A stock like Chevron, with a ~4% yield and a solid payout ratio, fits Buffett’s criteria for reliable income.
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Platform Tip: Zacks or Investing.com allow dividend yield and payout ratio customization.
5. Moving Average Crossover (50-Day Above 200-Day)
Why It Matters: While Buffett focuses on fundamentals, technical indicators like the moving average crossover can confirm a stock’s upward trend, ensuring you buy at the right time. A 50-day moving average crossing above the 200-day (Golden Cross) signals bullish momentum, relevant for 2025’s trend-driven markets.
How to Set It:
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- Filter for stocks where the 50-day moving average is above the 200-day.
- Add a volume filter (e.g., >500,000 shares daily) to avoid illiquid stocks.
- Example: A stock like Apple showing a Golden Cross in 2025 could confirm its fundamental strength with technical momentum.
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Platform Tip: TradingView or StocksToTrade excel at technical filters like moving averages.
Conclusion
These five stock screener settings—low P/E, high ROE, low debt-to-equity, solid dividend yield, and moving average crossover—align with Warren Buffett’s value investing philosophy while adapting to 2025’s market dynamics. By using these filters on platforms like Yahoo Finance, StocksToTrade, or Benzinga Pro, you can uncover undervalued stocks with strong fundamentals and momentum. Start screening today to build a portfolio that thrives in any market.
Try these settings on your favorite screener and share your top stock pick in the comments below! Join our newsletter at buffettpick.com for weekly value investing tips tailored to 2025.
