Financial Companies Are Different
I’ve received several e-mails from readers of my book, Choose Stocks Wisely, who have observed that financial companies don’t have the subtotals for “current assets” and “current liabilities” on their balance sheets. These amounts are required as inputs by my Adjusted Floor Price Scorecard, specifically to complete Part A on testing for adequate liquidity.
Further, two of my finviz.com screening filters are the quick ratio and the current ratio. Both of these ratios require that the current asset and current liability amounts be available. Thus, banks and other financial companies will not satisfy my screening filters due to “lack of available data.” Keep in mind, to run a finviz screen which can potentially yield financial company stocks among non-financial company stocks, any filter that depends on a current/non-current balance sheet account breakout must be excluded as a filter.
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