Wall Street loves to make stock selection sound like a combination of advanced calculus, artificial intelligence and whispered conversations with corporate executives in expensive restaurants.

It does not have to be that complicated.

Some of the most effective investment approaches are built around a handful of numbers that answer three basic questions:

Is the stock reasonably priced?

Is the business financially healthy?

Are earnings likely to grow?

A screen combining the price-to-earnings ratio, the Piotroski F-score, and the expected earnings growth rate over the next five years gives us a practical way to answer all three questions. It will not uncover every great investment, and it will occasionally identify a company that disappoints. No stock screen is a crystal ball.

However, this combination can quickly narrow thousands of publicly traded companies to a manageable list of reasonably priced businesses with improving financial conditions and attractive growth prospects.

That is a pretty good place to begin looking for the next generation of growth-stock winners.

What We’re Paying: The P/E Ratio

The price-to-earnings ratio is one of the oldest and most widely used valuation measures in the stock market. It tells us how much investors are paying for each dollar of current earnings.

A stock trading at 10 times earnings costs $10 for every $1 of annual profit. A stock trading at 40 times earnings costs $40 for the same dollar of profit.

The lower-priced company is not automatically the better investment. A business facing declining sales, shrinking margins, and mounting debt may deserve a low multiple. Meanwhile, a company capable of increasing earnings at 20% or 25% annually may be worth paying a somewhat higher price to own.

The trick is comparing the valuation to the company’s expected growth.

Suppose one stock trades at 12 times earnings and analysts expect earnings to grow by 15% annually during the next five years. Another trades at 35 times earnings with expected growth of just 10%.

The first company offers a much more favorable relationship between price and growth. We are paying less for each unit of expected earnings expansion.

This is closely related to the price-to-earnings-growth ratio, commonly known as the PEG ratio. Peter Lynch helped popularize the idea that a company’s P/E ratio should be viewed in relation to its earnings growth rate. Fidelity describes Lynch’s approach as growth at a reasonable price, combining the upside potential of growth investing with the valuation discipline normally associated with value investing.

I do not treat the PEG ratio as holy scripture. Five-year earnings estimates are educated guesses produced by analysts who occasionally struggle to predict what will happen next Tuesday.

Estimates change. Economic conditions change. Competition changes. Management teams can overpromise, underdeliver, or suddenly discover an irresistible urge to destroy shareholder capital through a monumentally stupid acquisition.

Still, earnings-growth estimates are useful. They tell us what the market currently expects, and they give us a framework for comparing valuation with potential growth.

The P/E ratio tells us what we are paying. The expected five-year growth rate tells us what we might receive.

We still need to know whether the company is financially strong enough to deliver that growth.

What Piotroski Figured Out

That is where Joseph Piotroski enters the picture.

Joseph Piotroski was an accounting professor at the University of Chicago when he published a landmark paper in 2000 titled “Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers.”

Piotroski began with a simple problem. Traditional value screens could identify statistically cheap stocks, but many of those companies were cheap for excellent reasons. Some were financially distressed. Others were losing money, issuing stock, taking on debt, or experiencing deteriorating operating performance.

He wanted to determine whether basic financial-statement analysis could separate financially strong companies from the potential disasters lurking in the bargain bin.

The result was the Piotroski F-score, a nine-point system using information drawn from a company’s financial statements. The signals measure profitability, cash generation, leverage, liquidity, share issuance, margins, and asset efficiency.

A company receives one point for each test it passes. The maximum score is 9.

Piotroski’s original research applied the score to high book-to-market stocks, meaning companies trading at low prices relative to book value. He found that selecting financially strong companies could increase the average annual return of the high book-to-market portfolio by at least 7 percentage points while shifting the overall distribution of returns in a favorable direction.

The beauty of the F-score is not that it predicts the future with supernatural accuracy. It does not.

Its value is that it forces us to examine the direction of the business.

Is the company profitable? Is operating cash flow positive? Is cash flow greater than reported net income? Is return on assets improving? Is leverage falling? Is liquidity improving? Is the company avoiding unnecessary share issuance? Are gross margins expanding? Is the company generating more sales from its asset base?

Those are not exotic questions. They are the basic signs of a company becoming financially stronger rather than weaker.

A high F-score does not guarantee that earnings will grow. It does tell us that the financial foundation beneath those growth expectations appears reasonably solid.

That matters because forecasts are easy to produce. Cash flow is harder to fake over long periods.

Peter Lynch and the Original Growth-at-a-Reasonable-Price Investor

Peter Lynch did not use the Piotroski F-score because it had not yet been invented during most of his tenure running the Fidelity Magellan Fund. However, the combination of valuation, financial strength, and earnings growth fits remarkably well with Lynch’s philosophy.

Lynch managed Magellan from 1977 through 1990. Fidelity records show that the fund had approximately $20 million in assets when he took over. By the time his tenure ended, Magellan had become an enormous investment operation.

The performance was extraordinary. Magellan gained more than 2,700% during Lynch’s 13-year tenure, and widely cited performance records place its annualized return at approximately 29%.

Those returns were not produced by predicting Federal Reserve meetings, guessing monthly employment numbers, or staring at squiggly lines on a chart until they revealed the secrets of the universe.

Lynch studied companies.

He looked for understandable businesses with room to expand, improving earnings, reasonable valuations, and strong competitive positions. He was particularly interested in companies that could reinvest their profits and continue growing for years.

He also paid attention to what was happening in the real world.

Customers standing in line at a restaurant, shoppers filling stores, and companies steadily opening new locations could provide clues that had not yet appeared in Wall Street research reports. Fidelity continues to summarize Lynch’s approach as using specialized knowledge to identify companies worth researching, while emphasizing that the observation is merely the beginning of the analytical process.

Lynch found opportunities in companies such as Taco Bell, Dunkin’ Donuts, Ford, Fannie Mae, Philip Morris, and Lowe’s. His Magellan portfolio reportedly produced more than 100 tenbaggers, his term for stocks that increased tenfold. Fannie Mae, Ford, and Philip Morris were among the celebrated long-term winners associated with his tenure.

The famous restaurant stories are entertaining, but investors sometimes learn the wrong lesson from them.

Lynch was not suggesting that people buy every company whose hamburger, coffee, or pantyhose they liked. He used consumer observations as the starting point for research.

The next step was examining the balance sheet, income statement, growth opportunity, competitive position, and valuation.

The stock still had to make financial sense.

Building the Screen

That is precisely what this screen attempts to do.

Expected five-year earnings growth helps us locate companies with the potential to expand.

The P/E ratio keeps us from paying any price Wall Street demands.

The Piotroski F-score helps confirm that the company’s recent financial statements show strength rather than deterioration.

Together, the three measures create a modern version of growth at a reasonable price with an additional financial-quality filter.

The initial screen is straightforward.

Start with profitable companies that have positive five-year expected earnings-growth rates. Eliminate companies with absurd P/E ratios or valuations that bear no sensible relationship to their forecast growth.

Next, require a strong Piotroski F-score. I generally prefer scores of 7 or higher. A score of 8 or 9 is even better, although using an extremely restrictive cutoff can leave us with a very small opportunity set.

Finally, compare the P/E ratio with the projected earnings-growth rate.

A company trading at 14 times earnings with projected growth of 18% is immediately interesting. A company trading at 45 times earnings with projected growth of 12% will need an extraordinary story to keep my attention.

I also prefer companies with positive free cash flow, manageable debt, and identifiable reasons that earnings could grow. The screen finds candidates. It does not replace reading financial statements, earnings releases, and conference-call transcripts.

Investors should also examine why the market is offering a stock at an attractive valuation.

Sometimes Wall Street has overlooked the opportunity. Sometimes the company is temporarily unpopular. Sometimes investors are worried about a cyclical slowdown that may already be reflected in the share price.

Occasionally, the market knows exactly what it is doing and the apparently cheap stock is standing directly in front of an oncoming freight train.

That is why we investigate before buying.

Running the Screen in Benzinga Pro

This screen can be created quickly using Benzinga Pro’s stock-screening tools. Investors can screen directly for the PEG ratio as a standalone indicator, making it easy to identify companies whose valuations appear reasonable relative to their expected earnings-growth rates.

There is no need to export the data or manually divide the P/E ratio by the projected growth rate. Benzinga Pro does that work for us. We can simply establish the maximum PEG ratio we are willing to accept and combine it with a strong Piotroski F-score.

A practical screen might begin by looking for companies with a PEG ratio below 1.5 and a Piotroski F-score of 7 or higher. More aggressive investors could require a PEG ratio below 1, indicating that the P/E ratio is lower than the expected annual earnings-growth rate.

The exact limits can be adjusted depending on market conditions and the number of stocks produced by the screen. When growth stocks become wildly popular and valuations expand, very few companies may qualify. During market corrections or periods of investor pessimism, the list may become much larger.

Additional filters can be used to eliminate tiny, illiquid companies or businesses with excessive debt. Investors can also require positive free cash flow, minimum revenue growth, a specific market capitalization, or other measures that match their investment objectives.

The practical advantage is speed.

Instead of wandering through thousands of ticker symbols or chasing whichever stock is being shouted about on financial television, we can ask Benzinga Pro a specific question: show me profitable companies with low PEG ratios, strong Piotroski F-scores, and solid expected earnings growth.

The resulting list becomes our research pipeline.

The screen can be saved and run weekly or monthly. Newly qualifying stocks can be investigated, while companies that disappear from the screen can be reviewed for reduced earnings estimates, deteriorating fundamentals, or excessive share-price appreciation.

This does not turn investing into an effortless push-button exercise. Nothing worth doing works that way.

It does eliminate a great deal of wasted motion.

Rather than beginning with an exciting story and trying to invent reasons to buy the stock, we begin with valuation, financial strength, and growth. We can then determine whether the company’s business prospects support the numbers.

5 Stocks That Passed the Screen

A recent version of the screen produced five companies worth additional investigation: National Vision Holdings, Newmark Group, dLocal, Opera, and Bioventus.

None should be purchased solely because it appeared in a screen. Each does, however, possess characteristics that could make it suitable for a growth-oriented portfolio purchased with valuation discipline.

National Vision Holdings

National Vision Holdings (NASDAQ:EYE) is one of the largest optical retailers in the United States. The company operates more than 1,200 locations across 38 states and Puerto Rico, primarily serving value-conscious consumers who need affordable eye examinations, eyeglasses, and contact lenses. Its major retail banners include America’s Best Contacts & Eyeglasses and Eyeglass World.

The business benefits from several durable trends. The population is aging, screen use continues to increase, and vision correction is not usually an optional purchase. Consumers may delay buying a new television or replacing the patio furniture, but people who cannot read a road sign eventually need glasses.

National Vision occupies the value end of the market, which could prove advantageous when household budgets are under pressure. Its stores combine eye examinations with eyewear sales, allowing the company to participate in multiple parts of the customer relationship.

The company spent several years dealing with operational challenges, cost pressures, and changes involving its legacy Walmart relationship. Recent results suggest that the core business is improving. Fiscal 2025 revenue from continuing operations increased 9%, comparable-store sales rose, and adjusted operating income increased substantially.

EYE is not a glamorous technology stock, which is part of the attraction. It is an understandable consumer-health business with recurring demand, a large store network, and room for continued operational improvement. If management can sustain sales growth while expanding margins, earnings could rise faster than revenue.

Newmark Group

Newmark Group (NASDAQ:NMRK) is a global commercial real estate services company. It advises property owners, investors, lenders, and corporate tenants on leasing, investment sales, mortgage financing, loan servicing, valuation, property management, and other real estate decisions.

The company operates across major property categories, including office, industrial, multifamily, retail, hospitality, and data centers. It also has substantial capabilities in commercial mortgage origination and servicing. Newmark generated approximately $3.3 billion in 2025 revenue, primarily from commissions, management services, servicing fees, and related advisory activities.

Newmark is a leveraged play on the normalization of commercial real estate activity.

Higher interest rates, tighter lending standards, and uncertainty surrounding office properties caused transaction volumes to collapse across much of the industry. Brokers cannot collect commissions on buildings nobody is willing or able to buy.

That painful environment also created an attractive setup. Commercial real estate owners eventually have to refinance, sell, restructure, or recapitalize properties. Deferred activity does not disappear forever.

Newmark’s diversified platform gives it exposure to a recovery in sales and financing volumes while its servicing and management operations provide more recurring revenue. The company’s second-quarter 2026 update reported trailing 12-month revenue exceeding $3.6 billion and a network of approximately 200 offices and more than 10,000 professionals.

NMRK offers investors an opportunity to participate in a commercial real estate recovery without directly owning troubled buildings. That may be the more intelligent side of the table.

dLocal

dLocal (NASDAQ:DLO) provides payment infrastructure that helps global companies collect money from and make payments to consumers and businesses in emerging markets.

Operating in countries across Latin America, Africa, and Asia, dLocal connects international merchants with local payment systems that can otherwise be difficult to navigate. Its platform supports credit cards, bank transfers, digital wallets, cash-based payments, and other country-specific methods. The company describes itself as a technology-first platform connecting global merchants with billions of consumers in emerging markets.

This solves a real problem.

A global streaming service, online retailer, travel company, or software provider may want customers in Brazil, Mexico, Nigeria, or India. However, accepting local payments, managing currency conversion, satisfying regulations, and settling funds can become a bureaucratic nightmare.

dLocal allows merchants to integrate through a single platform rather than building separate payment systems for every country.

The long-term opportunity is tied to rising digital commerce, financial inclusion, and cross-border business activity in developing economies. dLocal has also expanded its services beyond simple payment collection to include payouts, fraud prevention, and additional financial infrastructure.

The risks include regulatory changes, foreign-exchange volatility, competition, and the complexity of operating across numerous jurisdictions. Emerging markets rarely provide a smooth ride.

Still, the company occupies an attractive position between global merchants and rapidly expanding consumer markets. If transaction volumes continue growing while dLocal preserves attractive margins and cash generation, the business could compound earnings at a healthy rate for years.

Opera Limited

Opera Limited (NASDAQ:OPRA) develops web browsers and related internet products used by consumers around the world.

Its offerings include the traditional Opera browser, the mobile-focused Opera Mini platform, and Opera GX, a browser designed specifically for gamers. The company earns revenue primarily through search agreements, advertising, and partnerships that monetize its user base.

Opera reported 288 million monthly active users during the first quarter of 2026. Annualized average revenue per user increased 25% from the prior year, illustrating the company’s effort to generate more revenue from its existing audience rather than relying entirely on user growth.

The browser market is dominated by enormous technology companies, which makes Opera easy for investors to ignore. It does not need to defeat Google Chrome or Apple Safari to succeed. It only needs to maintain a loyal niche audience and improve monetization.

Opera GX is particularly interesting because gamers are a valuable and highly engaged demographic. The company is also integrating artificial intelligence tools and additional content features into its browsers, potentially increasing usage and advertising opportunities.

Full-year 2025 results showed fourth-quarter revenue growth of 22%, and the company authorized a $300 million share-repurchase program.

Opera combines a globally recognized consumer brand, a substantial installed user base, strong recent growth, and an asset-light business model. The company still faces competitive and partner-concentration risks, but OPRA appears to be something Wall Street frequently overlooks: a profitable technology company growing rapidly without requiring investors to pay an absolutely ridiculous valuation.

Bioventus

Bioventus (NASDAQ:BVS) is a medical-technology company focused on products that support healing, reduce pain, and improve recovery from musculoskeletal injuries and surgical procedures.

Its portfolio includes bone-growth stimulation systems, osteoarthritis pain treatments, and surgical products used by orthopedic specialists. These products address large markets influenced by aging populations, arthritis, sports injuries, and the continuing demand for joint and spine procedures.

The company’s pain-treatment business includes products used to manage osteoarthritis symptoms, while its bone-healing products are designed to assist patients whose fractures or spinal-fusion procedures may benefit from additional stimulation. Bioventus also sells surgical solutions used in orthopedic settings.

This is not a speculative biotechnology company hoping that a single laboratory experiment eventually turns into a commercial drug. Bioventus sells established medical products into existing markets and generates meaningful revenue.

The company has spent the past several years simplifying operations, divesting noncore assets, reducing financial strain, and concentrating on its strongest franchises. Recent results have shown organic growth in its continuing operations, including a 7% increase in first-quarter 2025 revenue and a 7.7% increase in pain-treatment sales.

BVS still carries execution and balance-sheet risks, and reimbursement trends always require attention in medical technology. However, improving fundamentals combined with steady demand could create significant earnings leverage. If management continues reducing debt and expanding margins, the market may eventually place a much higher value on the remaining business.

The Bottom Line

Great growth-stock investing is not about buying the company with the most exciting presentation, the loudest chief executive, or the largest collection of artificial intelligence buzzwords.

It is about finding businesses capable of increasing earnings for a long time and purchasing them at prices that leave room for investors to prosper.

Peter Lynch demonstrated how powerful that combination could be. His greatest winners were not merely companies with good stories. They were businesses whose earnings grew far beyond what the market initially expected.

Joseph Piotroski gave investors another useful tool by demonstrating that straightforward financial-statement signals could help separate strong companies from weak ones.

Combining the two ideas produces a sensible stock-selection framework.

Use the P/E ratio to measure what we are paying.

Use expected five-year earnings growth to estimate the opportunity.

Use the Piotroski F-score to determine whether the company’s financial condition supports the story.

Benzinga Pro makes it possible to run this screen quickly, save the results, and create a repeatable pipeline of stocks for further research.

National Vision, Newmark, dLocal, Opera, and Bioventus currently deserve a place on that research list. They operate in very different industries, but each offers a potentially attractive combination of growth, improving or solid fundamentals, and a valuation that has not completely departed from planet Earth.

That does not make them automatic buys.

It does make them worth considering.

In a market filled with expensive stories, speculative excitement, and Wall Street sales pitches, a disciplined search for financially strong growth companies trading at reasonable prices remains one of the most productive ways to hunt for tomorrow’s winners.