In the quickly changing market of today, finding underappreciated, high-potential stocks can seem to be looking for a needle in a haystack. Whether you’re an income investor looking for secure dividend payers or a value investor looking for long-term plays, having the proper stock screener and filter parameters can be your greatest ally.
This tutorial covers the top stock screeners and demonstrates how to employ certain filters to discover neglected stocks with strong fundamentals, including a demonstration of the advanced Stocks Telegraph Screener designed for practical, everyday investors such as yourself.
Why Use a Stock Screener?
A stock screener is an analysis tool that allows you to sort through thousands of stocks according to your own custom criteria — including dividend yield, valuation multiples, earnings growth, debt, and more.
For investors focused on income, screeners are particularly helpful in finding:
- Sustainable high-yield dividend stocks
- Strongly fundamental, yet undervalued stocks
- Low payout ratio companies with good free cash flow
Rather than acting on hype or headlines, screeners guide you to data-driven choices.
Best Stock Screeners to Find Undervalued Stocks
1. Stocks Telegraph Screener
Best for: Income-focused and value investors
Website: https://www.stockstelegraph.com/screener
The Stocks Telegraph Screener is designed for practical investors who want to:
- Sort stocks according to dividend yield, payout ratio, and earnings growth
- Examine undervalued stocks using PE ratios, PEG ratios, and intrinsic value measures
- Find high-potential stocks below $10, or in major income segments such as REITs, utilities, and consumer staples
What distinguishes it is its ease of use, structure, predefined value filters, and capacity to save watchlists of undervalued shares for future monitoring.
2. Finviz Screener
Best for: Quick value snapshots
Finviz offers free access to filters like:
- Price-to-Earnings (P/E) ratio
- Price-to-Book (P/B) ratio
- Dividend yield and institutional ownership
You can easily combine filters like “P/E under 15” and “Dividend Yield above 4%” to spot value + income stocks in seconds. However, advanced features require a premium upgrade.
3. Yahoo Finance Screener
Best for: Beginners
Yahoo Finance provides a free and simple interface to:
- Filter stocks by valuation, growth, and dividend metrics
- View real-time data and analyst ratings
- Explore “undervalued” tags on selected stocks
While not as deep as other screeners, it’s a great starting point for new investors exploring undervalued ideas.
4. Morningstar Premium
Best for: Deep fundamental research
Morningstar’s premium screener includes:
- Star ratings for stock valuation
- Fair value estimates and economic moat ratings
- Dividend safety grades
This platform is ideal for long-term value investors but comes with a subscription fee.
Key Filters to Find Undervalued Dividend Stocks
In order to find actual “undervalued gems,” income investors need to look at both value ratios and signs of dividend health. The following are the best filters to apply:
Price-to-Earnings Ratio (P/E)
- Lower P/E values indicate undervaluation; target below 15 for traditional value plays.
Price-to-Book Ratio (P/B)
- A P/B ratio below 1.5 may signal that a stock is selling at a level below its net asset value.
Dividend Yield
- Seek yields of 3%–6%, high enough to earn income yet low enough to sustain.
Payout Ratio
- Assess what proportion of income is returned as dividends.
- Optimal range: 30% to 60% to support dividend sustainability.
Free Cash Flow
- Those with solid free cash flow can more easily support and increase dividends, even during bad times.
Debt-to-Equity Ratio
- A lower ratio (ideally below 1) shows financial stability, key for reliable income.
Forward P/E & PEG Ratio
- The PEG ratio (price/earnings to growth) adds a growth component to P/E and is great for finding undervalued growth-income hybrids. A PEG below 1 is often considered attractive.
How to Use the Stocks Telegraph Screener
Here’s how income investors can set up a powerful screener:
- Go to https://www.stockstelegraph.com/screener
- Select filters:
- Dividend Yield ≥ 4%
- Payout Ratio ≤ 60%
- P/E Ratio ≤ 15
- Free Cash Flow Positive
- Sort results by:
- Sector (e.g., REITs, consumer staples)
- Market Cap (small-, mid-, or large-cap)
- Save your screen and track it weekly
You can also explore curated categories like:
- “Undervalued Dividend Stocks”
- “Best Stocks Under $10”
- “Top REITs for Passive Income”
Pro Tips for Identifying Real Value
- Don’t chase ultra-high yields (8%+). Often, they signal distress.
- Cross-check dividend history, look for consistent or growing payouts over at least 5 years.
- Compared to sector peers, what’s undervalued in tech might be different from utilities.
- Use forward-looking measures, concentrate on earnings estimates and dividend viability.
Example: Screening for Income & Value
Imagine you want to find a safe 5%+ yielder trading below fair value:
- P/E under 15
- Dividend Yield ≥ 5%
- Payout Ratio ≤ 65%
- Debt/Equity ≤ 1
- Sector: REITs or Utilities
With the Stocks Telegraph Screener, you can apply all these filters simultaneously and uncover strong candidates like Realty Income (O), Altria Group (MO), or Pfizer (PFE).
Finally:
The stock market is usually rewarding for intelligent and patient investors. Instead of speculating on which stocks are undervalued or chasing trends, you should use powerful screeners to filter out the noise and reveal genuine value.
Regardless of whether you are looking for undervalued dividend giants or income stocks that hide, utilities such as the Stocks Telegraph Screener can convert hours of scouring into minutes, and allow you to build a portfolio based on income, safety, and long-term potential.
