PayPal, Veeva, Lululemon Among 15 Stocks On This Screen| Investor’s Business Daily

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Which companies qualify as potential Warren Buffett stocks? Lululemon Athletica (LULU), Veeva Systems (VEEV), Lululemon Athletica (LULU) and PayPal (PYPL)  are among 15 stocks on this screen. Pool (POOL) tops the list in terms of sustainable growth.


Since the Oracle of Omaha has never written a book detailing his investment strategy, there’s no definitive buying checklist. But parts of his stock-picking strategy can be gleaned from the annual reports of Berkshire Hathaway (BRKB).

The list below highlights Warren Buffett stocks like Lululemon, Veeva, Pool stock and PayPal that are in sync with his focus on management quality and long-term growth.

Given their long history of strong and stable earnings growth, Pool stock and PayPal stock are both on IBD Long-Term Leaders. Veev stock is on the IBD Long-Term Leaders watchlist.

Created in MarketSmith, the screen below emphasizes metrics when looking for companies with long-term past and potential future growth. To make the list, each stock must meet a wide range of criteria, including:

  • Top 25% of all stocks in terms of five-year annual EPS growth rate.
  • Top 15% of all stocks in terms of sustainable growth.
  • 20% or greater sustainable growth.
  • 12% or better return on equity.
  • 15% or greater sustainable EPS growth rate.

Create Your Own Custom Stock Screens With MarketSmith

Investor’s Business Daily uses a different stock-picking strategy than the Oracle of Omaha. Still, as noted above, in addition to making this screen of Warren Buffett stocks, Pool stock and PayPal stock are on the IBD Long-Term Leaders.

VEEV, PYPL and Pool stock are also on the IBD 50 list of top growth stocks, along with Logitech (LOGI) and homebuilder D.R. Horton (DHI). PayPal stock is also on the IBD Big Cap 20.

Warren Buffett Stocks: MarketSmith Screen

Screen created using MarketSmith | Data as of Dec. 23, 2020

Company Symbol Sustainable Growth % EPS % Growth 5 Yr Pct Rnk ROE 5-Yr Avg EPS Rating SMR Rating Comp Rating
Pool Corp POOL 52 76 73 97 A 99
United Rentals Inc URI 42 83 39.3 81 B 93
Enova International Inc ENVA 39 88 26 98 A 95
Lululemon Athletica LULU 38 83 31.2 90 A 95
Qualys Inc QLYS 26 89 18.9 97 A 91
Deckers Outdoor Corp DECK 25 84 19 94 A 97
Mitek System Inc MITK 24 77 17.3 93 A 97
Veeva Systems Inc Cl A VEEV 24 92 24.9 99 A 84
Logitech Intl Sa LOGI 23 82 31.5 99 A 99
Progressive Corp Ohio PGR 22 90 22.2 99 A 86
PayPal Holdings Inc PYPL 22 81 17.3 99 A 99
Old Dominion Fght Line ODFL 19 82 19.2 90 B 77
D R Horton Inc DHI 18 83 16.2 99 A 91
Cintas Corp CTAS 17 80 25.2 89 A 82
Bristol Myers Squibb Co BMY 15 82 31.5 98 A 77

Rating Potential Oracle Of Omaha Stocks

While using different criteria than used for this list of Warren Buffett stocks, PYPL, POOL and LULU stock all score a passing rating in Stock Checkup for their 95 or higher Composite Ratings.

But some of the stocks on this list do not have a 95 or higher Composite Rating. Plus, others do not meet some certain benchmarks CAN SLIM investors typically look for in the other IBD SmartSelect Ratings that gauge a company’s fundamental strength.

Ranging from 1 (worst) to 99 (best), the Composite Rating reveals how strongly a company is showing the seven telltale traits of winning stocks. For example, a rating of 95 means the company is outperforming 95% of all other stocks in terms of the most important fundamental and technical stock-picking criteria.

The EPS Rating tracks a company’s annual and quarterly earnings growth, then measures how its numbers stack up against those of all other stocks. So just like the Composite Rating, a score of 95 means the company’s EPS growth is in the top 5% of all stocks.

The SMR Rating tracks sales growth, profit margins and return on equity as a whole. An A rating means the company is in the top 20% of all stocks in terms of those key fundamental performance metrics. Since it ties in with the legendary investor’s focus on a company’s fundamentals, this can be a particularly useful rating for investors looking for potential Warren Buffett stocks.

Follow Matthew Galgani on Twitter at @IBD_MGalgani.


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