Combining MACD and Revenue Growth for Stock Selection

Summary

The document outlines a stock screen that combines a technical condition with company characteristics and revenue growth. Its stated selection rule looks for MACD above zero, excludes several enterprise types, and requires 2021 revenue to exceed 2018 revenue by a specified ratio. The rationale is to combine price momentum with a basic measure of business growth.

The post also gives a Python example and describes screening for rising revenue and a recent upward MACD movement. That implementation appears to use quarterly revenue observations and a MACD comparison between recent readings, so it is not identical to the stated formula. The document offers no backtest results or evidence that the screen produces superior returns. It cautions that revenue growth can prove unsustainable and may not reflect valuation or profitability, and suggests adding broader financial and industry factors while applying risk controls.

Key ideas

• The stated screen combines MACD above zero with company-type exclusions and multi-year revenue growth.
• The accompanying Python example uses recent MACD movement and quarterly revenue observations.
• The code example and the final screening formula do not match exactly.
• Revenue growth alone may be unsustainable and does not establish fair value or profitability.
• The document provides no performance test and recommends broader analysis and risk controls.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.