For trading: the real edge with fundamentals is getting the bigger picture context.
Is this a real business with durable revenue or a story stock
Is it consistently profitable or burning cash
Is its PE overextended compared to its competitors.
You combine that context with what you see on the tape. Stocks with stable fundamentals will have more stable trends.
Fundamentals help you decide which names you focus on, how you size, and what kind of behavior to expect.
Fundamentals don’t give you entries
They keep you from treating every ticker like it’s the same kind of animal
An overall weighted Score is calculated to gauge the overall financial health.
Use on a Daily Chart. Useful for anyone interested in fundamental stock research.
The first indicator is found in this post.
The second lower indicator is found:
https://usethinkscript.com/threads/...abels-for-thinkorswim.5308/page-6#post-160403
Ruby:
#Fundamental Data Labels _Mobius 4/26/20 (found on OneNote)
#
# @MerryDay revised 4/21:
# my interpretation of positive/negative values; should be modified to meet your strategy
# then calculated an overall weighted score based on:
# https://tradestation.tradingappstore.com/products/FundamentalScore/document/Fundamental_Score.pdf
# and other information found on the web
declare lower;
DefineGlobalColor("Pre_Cyan", CreateColor(50, 200, 255)) ;
DefineGlobalColor("LabelGreen", CreateColor(0, 165, 0)) ;
DefineGlobalColor("LabelRed", CreateColor(225, 0, 0)) ;
DefineGlobalColor("Violet", CreateColor (200, 125, 255)) ;
DefineGlobalColor("GrayGreen", CreateColor(155, 167, 76)) ;
DefineGlobalColor("LitePink", CreateColor (220, 180, 180)) ;
DefineGlobalColor("neutral", color.light_gray) ;
input lPE = yes ;
input lEPS = yes ;
input lCASH = yes ;
input lGP = yes ;
input lOP = no ;
input lNP = no ;
input lCRatio = no ;
input lQRatio = yes ;
input lROA = no ;
input lROE = yes ;
input lSPS = yes ;
input lFCC = no ;
input lAssTURNS = no ;
input lFinLev = no ;
input lBV = no ;
input lDEBT = yes ;
input lInvTurn = no ;
input lDivOUT = no ;
input lDPS = no ;
input lDIV = no ;
input lIR = no ;
input lTR = no ;
input lSCORE = yes ;
def fp = FiscalPeriod.YEAR;
def EPS = EarningsPerShareTTM(fiscalPeriod = fp);
def PE = round(close / EPS,1);
AddLabel(lPE and PE, "P/E ratio = " + Round(PE, 2),
if PE < 0 then GlobalColor("LitePink") else
if PE < 20 then GlobalColor("LabelGreen") else
if PE < 40 then GlobalColor("GrayGreen") else GlobalColor("Pre_Cyan"));
def EarnPerShare = if IsNaN(EarningsPerShareTTM())
then EarnPerShare[1]
else EarningsPerShareTTM();
AddLabel(lEPS and EarnPerShare, "EPS-TTM = " + AsDollars(EarnPerShare),
if EarnPerShare > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def FreeCashFlowPerSh = if isNaN(FreeCashFlowPerShare())
then FreeCashFlowPerSh[1]
else FreeCashFlowPerShare();
AddLabel(lCASH and FreeCashFlowPerSh, "Free Cash Flow Per Share = " + AsDollars(FreeCashFlowPerSh),
if FreeCashFlowPerSh > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_EarnCash = if PE <0 and FreeCashFlowPerSh < 0 and EarnPerShare < 0 then 0 else 5;
def Gross_Profit_Margin = if IsNaN(GrossProfitMargin())
then Gross_Profit_Margin[1]
else GrossProfitMargin();
AddLabel(lGP and Gross_Profit_Margin, "Gross Profit Margin = " + Round(Gross_Profit_Margin, 2),
if Gross_Profit_Margin > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def Operating_Profit_Margin = if IsNaN(OperatingProfitMargin())
then Operating_Profit_Margin[1]
else OperatingProfitMargin();
AddLabel(lOP and Operating_Profit_Margin, "Operating Profit Margin = " + Round(Operating_Profit_Margin, 2),
if Operating_Profit_Margin > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def Net_Profit_Margin = if IsNaN(NetProfitMargin())
then Net_Profit_Margin[1]
else NetProfitMargin();
AddLabel(lNP and Net_Profit_Margin, "Net Profit Margin = " + Round(Net_Profit_Margin, 2),
if Net_Profit_Margin > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_Profits = if Gross_Profit_Margin>0 or Net_Profit_Margin>0 or Operating_Profit_Margin > 0 then 3 else 0 ;
def CurRatio = if IsNaN(CurrentRatio())
then CurRatio[1]
else CurrentRatio();
AddLabel(lCRatio and CurRatio, "Current Ratio = " + Round(CurRatio, 2),
if CurRatio > 2 then GlobalColor("GrayGreen") else
if CurRatio >= 1 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def Quick_Ratio = if IsNaN(QuickRatio())
then Quick_Ratio[1]
else QuickRatio();
AddLabel(lQRatio and Quick_Ratio, "Quick Ratio = " + Round(Quick_Ratio, 2),
if Quick_Ratio > 2 then GlobalColor("GrayGreen") else
if Quick_Ratio >= 1 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_Ratios = if Quick_Ratio >= 1 or CurRatio >= 1 then 3 else 0;
def Return_On_Assets = if IsNaN(ReturnOnAssets())
then Return_On_Assets[1]
else ReturnOnAssets();
AddLabel(lROA and Return_On_Assets, "Return On Assets = " + Round(Return_On_Assets),
if Return_On_Assets >= 15 then GlobalColor("Pre_Cyan") else
if Return_On_Assets >= 10 then GlobalColor("LabelGreen") else
if Return_On_Assets > 0 then GlobalColor("GrayGreen") else GlobalColor("LitePink"));
def Return_On_Equity = if IsNaN(ReturnOnEquity())
then Return_On_Equity[1]
else ReturnOnEquity();
AddLabel(lROE and Return_On_Equity, "Return On Equity = " + Round(Return_On_Equity),
if Return_On_Equity >= 15 then GlobalColor("Pre_Cyan") else
if Return_On_Equity >= 10 then GlobalColor("LabelGreen") else
if Return_On_Equity > 0 then GlobalColor("GrayGreen") else GlobalColor("LitePink"));
def score_Returns = if Return_On_Equity >= 10 or Return_On_Assets >=10 then 1 else 0 ;
def Sales_Per_Share = if IsNaN(SalesPerShare())
then Sales_Per_Share[1]
else SalesPerShare();
AddLabel(lSPS and Sales_Per_Share, "Sales Per Share = " + Round(Sales_Per_Share, 2),
if Sales_Per_Share > 0 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_Sales_Per_Share = if Sales_Per_Share > 0 then 1 else 0;
def FixChgCovRatio = if IsNaN(FixedChargeCoverageRatio())
then FixChgCovRatio[1]
else FixedChargeCoverageRatio();
AddLabel(lFCC and FixChgCovRatio, "Fixed Charge Coverage Ratio = " + Round(FixChgCovRatio, 2),
if FixChgCovRatio >= 1 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def Total_Asset_Turnover = if IsNaN(TotalAssetTurnover())
then Total_Asset_Turnover[1]
else TotalAssetTurnover();
AddLabel(lAssTURNS and Total_Asset_Turnover, "Total Asset Turnover = " + Round(Total_Asset_Turnover, 2),
if Total_Asset_Turnover > 1 then GlobalColor("LabelGreen") else GlobalColor("neutral"));
def FinLev = if IsNaN(FinancialLeverage())
then FinLev[1]
else FinancialLeverage();
AddLabel(lFinLev and FinLev, "Financial Leverage = " + Round(FinLev, 2),
if FinLev > 0 and FinLev < 2 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_FinLev = if FinLev < 2 then 1 else 0;
def BookValue = if IsNaN(BookValuePerShare())
then BookValue[1]
else BookValuePerShare();
AddLabel(lBV and BookValue, "Book Value Per Share = " + Round(BookValue),
if BookValue < 2 then GlobalColor("Pre_Cyan") else
if BookValue < 3 then GlobalColor("LabelGreen") else GlobalColor("neutral"));
def Long_Term_Debt_To_Capital = if IsNaN(LongTermDebtToCapital())
then Long_Term_Debt_To_Capital[1]
else LongTermDebtToCapital();
AddLabel(lDEBT and Long_Term_Debt_To_Capital, "Long Term Debt To Capital = " + Round(Long_Term_Debt_To_Capital, 2),
if Long_Term_Debt_To_Capital < 5 then GlobalColor("LabelGreen") else GlobalColor("LitePink"));
def score_Long_Term_Debt_To_Capital = if Long_Term_Debt_To_Capital < 5 then 1 else 0;
def Inventory_Turnover = if IsNaN(InventoryTurnover())
then Inventory_Turnover[1]
else InventoryTurnover();
AddLabel(lInvTurn and Inventory_Turnover, "Inventory Turnover = " + Round(Inventory_Turnover, 2),
if Inventory_Turnover < 5 then GlobalColor("LitePink") else
if Inventory_Turnover < 10 then GlobalColor("Pre_Cyan") else
if Inventory_Turnover < 15 then GlobalColor("GrayGreen") else GlobalColor("LitePink"));
def DivPayout = if IsNaN(DividendPayout())
then DivPayout[1]
else DividendPayout();
AddLabel(lDivOUT and DivPayout, "Dividend Payout = " + round(DivPayout,2) + "%", GlobalColor("neutral"));
def DivPerShare = if IsNaN(DividendsPerShareTTM())
then DivPerShare[1]
else DividendsPerShareTTM();
AddLabel(lDPS and DivPerShare, "Dividend Per Share = " + AsDollars(DivPerShare), GlobalColor("neutral"));
def DivYield = if IsNaN(DividendsPerShareTTM())
then DivPerShare[1]
else DividendsPerShareTTM()/Close;
AddLabel(lDIV and DivPerShare, "Dividend Yield = " + AsPercent(DivYield), GlobalColor("neutral"));
def Interest_Rate = if IsNaN(InterestRate())
then Interest_Rate[1]
else InterestRate();
AddLabel(lIR and Interest_Rate, "Interest Rate = " + Round(Interest_Rate, 2), GlobalColor("neutral"));
def Tax_Rate = if IsNaN(TaxRate())
then Tax_Rate[1]
else TaxRate();
AddLabel(lTR and Tax_Rate, "Tax Rate = " + Round(Tax_Rate, 2), GlobalColor("neutral"));
def score = score_Returns + score_EarnCash + score_ratios + score_Profits
+ score_FinLev + score_Sales_Per_Share + score_Long_Term_Debt_To_Capital;
AddLabel(lSCORE, "SCORE: " + score,
if score >= 12 then GlobalColor("Pre_Cyan") else
if score >= 10 then GlobalColor("LabelGreen") else
if score >= 8 then GlobalColor("GrayGreen") else GlobalColor("LitePink"),
Location.BOTTOM_LEFT);
Last edited:
