The CANSLIM methodology, popularized by William O'Neil, screens for growth stocks that combine strong quarterly and annual earnings, market leadership, institutional sponsorship, and favorable market direction. One name that currently emerges from such a screen is PAN AMERICAN SILVER CORP (NYSE:PAAS), a silver and gold producer whose latest metrics align closely with the approach.
Fundamental checklist
The "C" and "A" components of CANSLIM look for accelerating quarterly earnings and sales, plus solid annual growth. PAAS clears the basic hurdles:
- Quarterly EPS growth: 69.8% versus the 20% minimum.
- Quarterly revenue growth: 38.4% versus the 25% minimum.
- Three-year EPS growth: 200.4% versus the 25% minimum.
Profitability and balance sheet strength also matter. PAAS reports a return on equity of 17.2%, above the 10% threshold, and a debt to equity ratio of 0.11, far below the 2.0 maximum. Institutional ownership stands at 61.0%, under the 85% ceiling, which leaves room for additional buying pressure from large funds.
Investors who want to dive deeper into the ratios and valuation can use this fundamental analysis page to review the full breakdown.
Technical and market leadership
The "L" and "S" components focus on relative strength and volume demand. PAAS shows:
- Relative strength: 79.7, above the 75 threshold.
- Average daily volume: about 4.6 million shares, providing ample liquidity.
That relative strength places PAAS in the top quartile of the market, a key sign of leadership. However, the technical picture is not entirely clean. The stock earns a technical rating of 5 out of 10 and a setup score of 3 out of 10. While the short-term trend is positive, the long-term trend remains neutral. PAAS is currently trading in the middle of its 52-week range, roughly 31% below its high, and it is not in a proper base or breakout position that CANSLIM traders prefer.
For a closer look at the support and resistance zones, the technical analysis report provides additional detail.
Risks and limitations
CANSLIM emphasizes buying into strength and respecting market direction. The S&P500 is in a positive long-term and short-term trend, which is favorable for growth stocks. But PAAS has some headwinds. The fundamental report notes that the company is currently destroying value, with return on invested capital below its cost of capital. Future earnings estimates are modest, with expected EPS growth of only 1.5% per year over the next few years and revenue projected to decline slightly.
The stock also has a mixed short-term record: it gained 14% over the past month but fell 10.8% over three months and 25.6% over six months. That volatility underscores why setup quality matters in the CANSLIM framework.
What other screens show
PAAS also appears on a high free-cash-flow screen that combines strong cash generation with quality and liquidity filters. The screen flags PAAS for generating strong free cash flow relative to its market price, adding an independent fundamental confirmation.
Bottom line
PAAS meets several quantitative CANSLIM hurdles, especially on fundamentals and relative strength. The main caveat is technical timing; the stock is not in a high-quality entry zone. For investors who want to monitor a broader list of candidates that pass the same methodology, this screen offers a starting point.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
Read full article here »
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Pan American Silver (NYSE:PAAS) Demonstrates High-Growth Leadership and Momentum
The CANSLIM methodology, popularized by William O'Neil, screens for growth stocks that combine strong quarterly and annual earnings, market leadership, institutional sponsorship, and favorable market direction. One name that currently emerges from such a screen is PAN AMERICAN SILVER CORP (NYSE:PAAS), a silver and gold producer whose latest metrics align closely with the approach.
Fundamental checklist
The "C" and "A" components of CANSLIM look for accelerating quarterly earnings and sales, plus solid annual growth. PAAS clears the basic hurdles:
Profitability and balance sheet strength also matter. PAAS reports a return on equity of 17.2%, above the 10% threshold, and a debt to equity ratio of 0.11, far below the 2.0 maximum. Institutional ownership stands at 61.0%, under the 85% ceiling, which leaves room for additional buying pressure from large funds.
Investors who want to dive deeper into the ratios and valuation can use this fundamental analysis page to review the full breakdown.
Technical and market leadership
The "L" and "S" components focus on relative strength and volume demand. PAAS shows:
That relative strength places PAAS in the top quartile of the market, a key sign of leadership. However, the technical picture is not entirely clean. The stock earns a technical rating of 5 out of 10 and a setup score of 3 out of 10. While the short-term trend is positive, the long-term trend remains neutral. PAAS is currently trading in the middle of its 52-week range, roughly 31% below its high, and it is not in a proper base or breakout position that CANSLIM traders prefer.
For a closer look at the support and resistance zones, the technical analysis report provides additional detail.
Risks and limitations
CANSLIM emphasizes buying into strength and respecting market direction. The S&P500 is in a positive long-term and short-term trend, which is favorable for growth stocks. But PAAS has some headwinds. The fundamental report notes that the company is currently destroying value, with return on invested capital below its cost of capital. Future earnings estimates are modest, with expected EPS growth of only 1.5% per year over the next few years and revenue projected to decline slightly.
The stock also has a mixed short-term record: it gained 14% over the past month but fell 10.8% over three months and 25.6% over six months. That volatility underscores why setup quality matters in the CANSLIM framework.
What other screens show
PAAS also appears on a high free-cash-flow screen that combines strong cash generation with quality and liquidity filters. The screen flags PAAS for generating strong free cash flow relative to its market price, adding an independent fundamental confirmation.
Bottom line
PAAS meets several quantitative CANSLIM hurdles, especially on fundamentals and relative strength. The main caveat is technical timing; the stock is not in a high-quality entry zone. For investors who want to monitor a broader list of candidates that pass the same methodology, this screen offers a starting point.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Always conduct your own research and consider your risk tolerance before making investment decisions.
Read full article here »