Stock Investor Pro Questions

Please use your AAII Stock Investor Pro to complete the following exercises.

1.

The chapter identifies and discusses a number of market anomalies, including the small-firm, price-earnings (PE)-ratio, and price-book (P/B)-ratio effects. In an attempt to capture these effects, use the Screen Editor in Stock Investor Pro to identify those firms with the following characteristics:
a. Market capitalization between $10 million and $100 million.
b. Price-to-book (P/B) value greater than 1.0.
c. Price-earnings (PE) ratio greater than the growth rate in earnings for the last five years (EPS-Growth 5 yr), so that PE 12m _ EPS-Growth 5yr.
d. Positive earnings for each of the last three fiscal years, so that EPS Y1 _ 0, EPS Y2 _ 0, and EPS Y3 _ 0.
e. Increasing earnings for the past two years, so that EPS Y1 _ EPS Y2 and EPS Y2 _ EPS Y3.
f. The company is not a financial firm (eliminate firms with an SIC code between 6000 and 6999).

Pick five firms (justify your selections) and check on their future performance.

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