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Review: Picking Stock Ideas With IBD Digital

Disclosure: Investor’s Business Daily provided ValueWalk a free subscription to IBD Digital for this review.

Investor’s Business Daily offers a variety of investing tools for do-it-yourself investors, including a number of stock lists designed for investors who look at the market in various ways. A subscription to IBD Digital wraps up several different stocks lists into one package with a wealth of other features. One of the great things about IBD Digital is the way stocks are grouped in all these lists because it enables investors to focus on specific sets of stocks based on the factors they prefer to target the most.

stocks lists
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A variety of stocks lists available via IBD Digital

After logging into IBD Digital, it’s easy to look at the various stocks lists by going to the dropdown menu and checking out the selections. One of the lists on IBD Digital I wanted to highlight was the CAN SLIM Select list, which zeros in on stocks that follow the CAN SLIM method.

IBD Digital describes this list as “market-leading stocks generally showing strong earnings growth, positive institutional sponsorship and industry group relative strength as well as solid sales growth, margin and return on equity.” In addition to choosing specific stocks based on what’s happening with each company, IBD also considers the overall health of the market and the health of the sector the stock is in. Most of the stocks lists in IBD Digital are put together by the IBD team, but the CAN SLIM Select list is compiled by Northcoast Asset Management.

The CAN SLIM list is interesting because it seems to include a wide variety of stocks from various sectors. Most of the stocks are companies that don’t get a ton of press coverage in the financial media, so this list brings to mind some good options that you might not think of yourself. It’s certainly a good resource for investors who are a fan of the CAN SLIM method, although I suspect IBD also uses some of those principles for its other products as well.

IBD 50 and IBD Big Cap 20

IBD Digital shows a strong preference for growth stocks, so if you favor value or another factor, then their stocks lists might not be as helpful for you. The IBD 50 list is a prime example of this, as IBD Digital compiles its list of “50 companies showing strong relative price strength and top-notch fundamentals.” The IBD team claims that the stocks on this list “historically far outperform the S&P 500,” which is certainly a big claim.

Some of the stocks on the IBD 50 list are particularly interesting because they don’t get positive coverage in the financial media, but when you look at their historic stock charts it becomes clear that they have been outperforming over the long term. IBD Digital is good in this way because it helps you cut through all the noise from analysts who dole out a lot of unhelpful commentary on some of these stocks. IBD Digital shows you the hard and fast numbers so that you can see in black and white whether a stock will fit well with your investing strategy.

If you’re looking for big-name stocks to own as core holdings in your portfolio, then the IBD Big Cap 20 may be just what you’re looking for. IBD Digital describes this list as “top-rated, large-cap growth stocks” and companies that “can deliver outsize gains without the volatility of smaller growth stocks.” Investors will already be familiar with most, if not all the names on this list, which includes favorites such as Facebook and Amazon. The list makes it easy to check the listings for each stock in IBD’s other premium products.

Stocks making highs

IBD Digital also makes it easy to see which stocks are hitting new highs on a regular basis. The New Highs list will tell you which stocks are hitting new 52-week highs on a regular basis. At the time I looked at it for this article, this list was a good mix of well-known and lesser-known names, making it a great resource to quickly see which stocks are on a steady uptrend.

If you’re really into the technical aspects of stock picking using the Relative Strength Indicator, then IBD Digital has a list for that as well. This list seems tailormade for investors who like to use technical signals when deciding which stocks to buy or sell.

IBD Digital also helps you follow the smart money

I particularly like the Stocks on the Move list, which separates stocks by those that are moving up and those that are on a steady downtrend. Another reason I really like this list is because IBD Digital is very clear about what being on each of these two lists means. These two lists are driven by institutional buying and selling, so the stocks that are on the uptrend list are those that are being bought heavily by institutional investors, while those on the downtrend list are heavily sold by them.

Investors who use institutional movements in stocks as key signals for stocks to buy, sell, or short will find this list to be especially helpful. In fact, out of all the stocks lists included in IBD Digital, I feel that the downtrend list on Stocks on the Move could be one of the clearest in terms of identifying which stocks could make good short positions.

There’s also another similar list called Stocks that Funds are Buying, which is a list of stocks that mutual funds are favoring. This is another way to plan your portfolio by watching what major investors are buying and using that to decide what you should buy.

IBD Digital also includes several other very helpful stocks lists. Although there is much more to IBD Digital than these stocks lists, I feel that they represent the strongest collections of information that’s available through the platform. If you want help building a shortlist of stocks using any of these signals, IBD Digital is a great place to start.

IBD Digital can be found here

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