FORMULA: How To Find Small Cap Stocks To Buy That Will 8x
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- เผยแพร่เมื่อ 2 ส.ค. 2024
- How to find small cap stocks to buy, the formula, is a result of my research on the small cap index where many of the businesses that did really good and were great stocks to buy, showed similar characteristics: PE of 10, single digit revenue growth organic and M&A, plus improvements in margins and profits thanks to scale.
0:00 Formula
2:18 MSCI Small Caps
5:00 Small Cap Examples
16:09 Stocks To Buy Formula
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Thanks for you vid about Markel. It is one of biggest holdings and I have wondered for years about it poor(ish) performance and you helped me a lot. Have a good Christmas.
Sven, you are the voice of rationality in this hyped stock market youtube channels. Thank you!
THanks1
Short, precise, and loaded with valuable info. Always looking forward for your coming videos. Thanks a million for the great work you keep posting.
Glad you like them!
Hvala Sven, jako dobra ideja za pronalazenje dobrih prilika medju small-caps kompanijama, svaka cast video je besprijekoran kao i uvijek! Pozdrav
hvala Marine!
Thank you Sven, you are amazing at what you do.
happy to hear that!
This is some brilliant insight here in this video. I am new to investing and most of the stuff online is either just news on price action , technical analysis or Stocks to buy this week etc. I like how you are able to layout some principles of investing, framework to think about companies but also then show it in action in with some applied examples. Keep these formulas and templates coming !!!
Glad it was helpful!
Fantastically valuable video to make those value discoveries! Thank you so much for sharing how you are looking at small caps!
:-)
Great video Sven, this is very interesting. Hope you Will make more of this type of videos.
you know, you don't need many of this type, this is it, not much more to discuss, only to research!
Thank you Sven as always, I’m rewatching this video 2 months later and taking notes because the information is so useful!
great to hear!
@@Value-Investing Hey Sven, I reviewed over 100 small-cap companies but used the Morningstar Small Cap Value holdings instead. I found 7 companies interesting and 4 that I would like to keep learning more about. I won’t tell you which is which but the tickers are; ATKR, LPX, OHI, HBI, MED, SLG, VNT. If you could write a comment on any one of them I would be very thankful. If you find them of interest to you or others potential for a video I would greatly appreciate it. 🙂
Thank you for all this superb content!
thanks!
awesome work Sven, making these insights available to the average investors !
happy to hear that.
What a great video, this is such a great idea. I think I will join you and look at the msci small cap index too !!
great to hear!
I just watched this video more than a year later and what an amazing video this is! Great work
Wow, thanks!
This video was a little Christmas gift for me, thank you sir! :)
my pleasure :-))
I'm very excited about the small caps and what you will find. Thank you
maybe one will be enough :-)
Great video! Thanks for sharing. I gotta start looking into small businesses.
:-)
I saw what you did there! ;p We focus so much sometimes on making a 10 % return, we almost forget there are way better opportunities out there! Thank you.
So true!
You are the terminator of stocks picks, i think you really need a help, so much work, thanks!
:-)
Sven, your channel is a real rivelation e you're a really nice person! Thanks for all!
I appreciate that!
@@Value-Investing Greetings from Italy (I know it's a piece of your life 🙂)
One of the best videos you've done Sven!
Please don't wait too long before doing the deep dive on Berry, we don't want it to get to 20% price to free cashflow before that :)
too much debt for me
This video looks like a summary of "One Up On Wall Street" basically... Great as always Sven! Buone feste! 👍
a confirmation!
Christmas just got better with a Video from Sven. Happy christmas from Norway
another one coming today :-))
Absolutely love that you are turning your attention to smallcaps Sven :D
thanks!
Just got into Bery this Monday - glad to be thinking along the same lines! Thanks for the video Sven
:-)
I started buying BERY in spring of 2021. ;) but price has been stagnant.
Thank you! Your formula is helpful.
Glad it was helpful!
Great work Sven, well done!
thanks!
Sven, another incredibly logical and well put together video! It would be great to get an update on where you are now on the MSCI small cap index and which names are sticking out to you most!
Something else I feel is quite important, particularly relating to small caps is know the best time range to enter a position. Too often the fundamentals of a business look great, but due to market not being interested yet, lack of volume, coverage (i.e. general momentum) you could be entering a position only to sit on 'dead money' for years.
if the business is doing well, it usually affects the stock in a year or two...
Thanks Sven this is what i need 👍👏
happy to hear that!
Learned a lot from this, thanks a lot
thanks!
Tip 2 "Strength" Thanks for the video Sven!
Thanks!
Thank you for the video!!!
Thank you!
Thanks for breaking down the index. Curious to see which one manages to get into the portfolio(s). Everyone can guess, I think, but never know, still have to wait and see ;-)
it is a process, let's see!
Such amazing contents lately, thanks for sharing
Glad you like them!
Very practical and useful video ... thanks!
Glad it was helpful!
Thank you for the gems Sven!
My pleasure!
Sven this is really impressive. I am looking at this video now that you mentioned Quanta Services and based on very logical assumptions (cash flow, average growth rates, industry related-demand etc) you highlighted that it was a good business. It was trading around 40usd per share up until 2021 and now its 146usd thats a 4X in one year!!!! You should do more analytical videos on specific small-mid caps in niche industries with competitive advantages. Well done! I will subscribe to your website first thing next month :)
Thanks, wuanta was good but i didnt invest in it :-( another mistake!
Yeah great formula Sven I think its usefull to apply it at this moment for the restaurant and hospitality business
if you can predict things there
Best value investing video on TH-cam
thanks for the great content!
My pleasure!
Straight up value content.
thanks!
Great video, as always! :)
thanks!
Maybe your best video so far! 👍👍👍is too litttlevof a "laudatio" for this masterpiece ... THANKD!
Wow, thank you!
Thanks so much, I finally found a website where I can start with the As!
good!
3,518 companies .. amazing work ethic .. thank-you Dr. Carlin!
I know, but I also know I will find one that will be worth it!
Thanks Sven!
Thanks!
Sven I am surprised you havent made a video about Fevertree PLC. a kind of business you might like. They are self sufficient, reinvesting profits for growth , small cap, sucessful in UK, working on international expansion.
As always, love your videos! Thank you so much and Merry Christmas in advance!
Too much risk for me, I don't know whether it will work or not!
You can do it Sven!
Go find them!
we just need one :-)
Great mr Sven!!!
Thanks!
Thanks , great information. Small caps are like a treasure hunt
yep!
Sven threw generously under Christmas. :) Merry christmas Sven.
Merry Christmas :-)
I have a front deck and back deck made of Trex. I LOVE it!!! There are alternative, low-cost copy-cats... so I would think the upside is limited (famous last words). No real moat in my opinion. They are just riding the housing price boom... when a person's house goes up in price, they don't mind spending money to build a fancy deck.
that is what it seems to me too!
Thank you Sven really I learned a lot from you
I used before some of this information in this video and I used some peter Lynch criteria on my screener I did well with (atkr) and (zim ) I did find some names that belongs to your list like (bldr) (wfg) (lpx) boring but fantastic business
thanks for sharing!
Hi Sven! Happy Christmas! I'm subscribed as your great platform, please found one of this x10 in 10 year for us as Christmas gift ! : D :D All the best for 2022
thanks, will do! Merry Christmas!
Like the humour in this Review Sven .
:-)))
Superb content! Thanks Sven! We'll try to steer clear of the STI's (Sexually Terrible Investments!)
haha, thanks!
I received Organon & Co. (NYSE:OGN) from the recent spinoff from Merck (NYSE:MRK). On the downside: OGN brought a lot of debt as well as expiring patents. Pretty cheap right now & a small dividend. I will add OGN shares on price dips for the reasons you've listed in this video. (Also: I have standing orders to DRIP all of my TFSA and RRSP holdings. Not sure if OGN offers DRIP yet.) I will definitely add some of your other small cap recommendations. (Alberta, Canada)
thanks for sharing!
I was watching OGN when Buffett bought it. Looks like he sold the whole position last quarter
Usually I don’t like to write a comment but this time I felt that had to Thank you for the quality information 🙏
thank you very much!
Thanks Sven
THank you!
Thanks for sharing
:-)
I'm focused on Canadian Jr Mining/exploration stocks, thanks Sven
the results there depend on the results of the exploration in progress, the financing structure and further development 0- thus not really profitable from the start! Also on commodity prices!
I totally agree with you with Berry Global. Even in my worst case scenario I will not loose money in the long term. If the market goes crazy this sector is a defensive sector.
thanks!
I actually bought some BERY this year from my own stock screening. I has very good numbers in FCF, Sales, ROIC etc. Since I did a huge acquisition in 2018, it build up a significant debt load with net debt/ebitda of 3.8. I think that is the reason the price has gone side ways for a long period. However, you can see the management has promised and executed the debt reduction in past 3 years. And the synergu of the acquisition has pervealed in the past 3 years.
merry christmas Sven!
Happy new year :-))
Nice video...Grazie! and Prego!😉
:-)
Excellent video as always! Thank you!
Berry is an interesting one but it looks expensive now. I follow the company for a couple or months. Let’s see what will happen in the next period.
thanks!
Expensive based on what? Its pretty cheap in todays interest rate environment for consistent double digit growth.
@@matmaism
Based on my expectations and compared to other posibilities on the stock market. You are right if we compare it to the other type of investment it can be considered cheap.
Thank you
Thank you!
Thanks, Sven. I should also spend more time understand the context of those 100 baggers. I know the number works but it’s hard to imagine those 100 baggers in a mature world like today. I would usually expect market to be pretty much saturated in traditional industries.
100x is a bit too much - th-cam.com/video/1ZceWi0ihSw/w-d-xo.html
Hey Sven, that is a really interesting way to look for small caps. I was wondering if you have done any back testing or if you know of any research papers that have done back testing on these metrics.
Thanks for the great content.
the whole Fama And French research is there for that, but I am not looking at small caps, I am looking for one, just one business to invest in!
@@Value-Investing Thanks for the Fama and French research tip. I'm new to investing so I am still trying to learn. Sometimes I find it hard to find good quality content on TH-cam. Your channel is great.
I agree 100%! I've got a stock screener that selects for low p/e, p/b, etc. I'm just not sure once everything is selected for, how to then understand if it's a good buy or not.
The small cap banks seem really cheap relative to earnings, but I just don't know when to pull the trigger.
The best finance teacher on TH-cam
Thanks!
Another good one ;)
Thanks!
Thank you, you finally took a look at Graco. 😅
you see, it comes sooner or later!
Sven have you ever looked into the solar industry? Perhaps a video on some solar stocks?
here you go: th-cam.com/video/aSZ9Pqh0hBE/w-d-xo.html
Hey Sven,
I think Thor Industries would be a stock to look into if you consider these characteristics of a company. It has; 10% FCF Yield, Div, Buybacks and growing rev's.
and very cyclical
Great video Sven I have feared small caps a bit from a permanent loss of capital perspective but you have convinced me to dig deeper and try to find the gems in the rough...or make more money to afford your platform!
only one is needed!
"Profitable from the start! Which really lowers the risk of getting sexual diseases!". Laughed my ass off... a good one.
:-)))
Small Caps are a great deal right in this market. I feel a lot safer putting my money in some good small caps than the S&P 500 right now.
My favorite small cap right now is big lots (BIG). It's a growing company/turnaround play that is priced like it's a dying mall store and is buying back shares like crazy.
thanks for sharing!
@@anthonyschneider8835 hopefully big can retain some of the customers it gained during the the covid shopping frenzy, it has been downhill for the last 6 months, and i defenetly overpaid
@@lordraja297 I am currently down on this one but I’ll gladly hold the bag and buy more. Wall Street overreacted to the current headwinds from shipping costs. They had a record Q1 last year and they just set record sales on Black Friday. If they are willing to buy back their own stock in the $50 range I’ll buy it as well!
Hi Sven
Great Video and interesting thoughts as Always.
A question About Market Cap...at what Point did These companies get Into the Index and will you have to Take Into consideration Market Cap growth that might make Them Leave this Index...will that have any effects on the Business?
the maximum is $13 billion, so that might have them leave, but then those enter new indexes etc... Not really relevant given the small exposure!
Hi Sven, could you make a video about how cash flow is calculated including cash from operating, investing, financing activities? And what they mean if some are rising and some are falling?
Have some nice days during Chrismas ;)
It would be very nice
thanks for suggesting, it will come one day!
@@Value-Investing Thanks, and merry Christmas Sven! Have some happy and safe holidays, thanks for what you do :)
I quickly skimmed through Berry, and another interesting thing is: Turtle Creek owns over 4% of the company, as far as I remember it is a fund ran by a guy who has 20% compounded returns over past 20 years. Im going to dig deeper soon.
thanks for sharing! Interesting!
@@Value-Investing I confirm it! It's the main position of that found that has been doing very well and they are strong value investors! Please Sven, do a resarch of this stock for your custumer in the platform (I am one of them ;) )
Brilliant video can't believe you giving this great advice for free.
Most other youtubers would charge.
Keep up the great work Sven
:-)) The how is free, the work is not :-( If I find the one good in the 3,500, that I will charge for!
@@Value-Investing that's only fair
Sven, could you please make video about NIU. they were profitable, but now have some margins trouble. They make double digits (in percent) in sales number every quarter
thanks for suggesting!
Just looking at smallcaps myself right now. What’s your opinion on Malibu Boats? Bedankt voor al je werk Sven!
haven't gotten there yet :-)
I am fairly new to trading. What site is he using to show the key ratios over 10 years. I like the way that is laid out.
Grazie.
Grazie a te!
Hello Sven, thank you for your work, what do you think about Hibbett Inc - 61.91 dollar ?
Don't know, haven't analyzed!
I like TREX it hits everything I look for but a bit expensive! Toro and Service Corp looks even more appealing!
thanks for sharing!
Sven would you make a stock analysis video about Koninklijke Philips NV
not really a business that I like, I think there is better
Sven, jeli to kao kad je cura ljepa pa je svi ganjaju a ona talašika.
A i zadnjeg reda su najljepše
:)
It would be interesting to see are companies for recycling of EV batteries going to be profitable in next few decades…
no, we will see what we get towards the end! Najljepsa je skupa za odrzavanje!
@@Value-Investing hahaha, jes jes,
Sve najbolje za praznike.
Legend
Thanks!
Thank you for this informative and refreshing video! Also Merry Christmas! Taking from your formula I did some research and came up with a hand full of companies that match your criterea at a first glance. There are $GPI $SIG and $HIBB. Ill continue to do some research on those names and I will also check out $BERY. Just one question I would be grateful to get your answer on. How important is insider ownership to you? Is there a threshold you look for? In consideration of $BERY the insiders own very little (approx 0.11%). Would this throw you off and disqulaify the company? Thanks
depends on the business!
@@Value-Investing How much were you concerned about BERY's heavy debt, espectially when interest rate will be up a bit in 2022?
Hi Sven, I had a question about screening and sorting potentially viable small caps from this list. Considering the ETF contains 3500 companies, and it would take too long for an individual with limited time and resources to carefully assess all of them, I have decided to start with the A's . For a first screening, I look on yahoo Finance, checking the stock price chart over 5 years and then max to see if it's been a gradually appreciating security or not, check the PE, dividend, check the statistics page to see the ROA and ROE, the forward PE, the P/B, P/S and EDITBA to total debt, followed by glancing at the financials tab to see if there's been gradual revenue and EBIT growth over the past 5 years, closing it with glancing at the analysis tab to see what analysts predict in terms of 5y. expected growth rate. This takes me about 1-2 minutes per company.
Do you think this is sufficient as a first screening process, or am I missing something vital here? (Further steps would be a deeper look into the company's balance sheet, a DCF model to determine a fair value range, and the qualitative aspects of the company).
I don't do screening, I just look at businesses, so can't help you there!
Dr Sven hello.
Can you explain why share buybacks shows strength....
they have extra capital at disposal and reward shareholders, think of BRK now!
Hi Sven, enjoying going through this video a few times. Can you tell me the site you are using for data ie headed; quote, chart, stock analysis, performance, key ratios, financials, valuation, insiders etc. Has Morningstar at top, but not same format when look at that site? Thanks
it is Morningstar
Hi Sven thanks for a great video. I am a little bit sceptical though how you can go through thousands of companies from different industries and different countries and determine which one is good and which one is bad. That's seems like an impossible task. I mean is balance sheet and financials the only thing that you base your decisions on? If for example you look at a company that produces robotics components as an example and you have no idea what the heck they are doing but their financials look good would you invest into something that you have no idea how it works?
then it is outside my circle of competence :-) But it is actually easy for me, I look at something as long as it fits the bill, usually you need 3 minutes to see it doesn't. I don't need the next robotics stock that will 100x, I need a good stable business that will 7x - I know what I am looking for :-)
this is just a initial rough screening to find a few that are standing out, then deeper analysis are required to decide if one or two of them are worth owning. They may also be on his watchlist for a while before he does any moves.
can we call it: "nature biz"analysis, not fin analysis. Mr Warren is good at that.
@@frankle246 it's not really an analysis, it's a screening.
Buone feste a te e famiglia
buone feste!
Does anyone know what website Sven is using for those KEY RATIOS? Thanks :)
Morningstar
what website do u use to show key ratios
Sensus Healthcare, Creightons, $VEEE, $MMMB 👍🏻
thanks for sharing!
Hi Sven, what do you think of APPS (Digital Turbine)?
uh, that was a while ago, don't remember
Question. I notice when a company does an offering that the public float is not updated instantly. Does anyone know a stock board or service that instantly updates public float and market cap after an offering has just been completed?