William O'Neil's Philosophy

William O'Neil founded Investor's Business Daily and discovered that virtually every great stock in history followed the same pattern before its big run. His CAN SLIM system combines fundamentals (earnings, growth) with technicals (chart patterns, market timing) to find leading stocks at the moment they're about to break out.

Key Principles

  • Current Earnings: Look for accelerating earnings, not just growth
  • Annual Growth: Consistent 25%+ growth over several years
  • New Things: New products, management, or highs create momentum
  • Supply & Demand: Tight float and rising volume signal a breakout
  • Leader or Laggard: Buy the strongest stocks in the strongest sectors

💡 Did You Know?

O'Neil studied every major market top and bottom from 1900 to 1990 and found that leading stocks before a bull market share the same traits: surging earnings, new highs, and heavy volume on breakouts. His system has been used by thousands of investors to find stocks like Apple in 1984, Microsoft in 1986, and NVIDIA in 2016.

Screener Criteria

Quarterly EPS Growth
> 25%
Year-over-year acceleration
Annual EPS Growth
> 25%
3-5 year average
ROE
> 17%
Profitable and efficient
Relative Strength
> 80
Outperforming the market
Volume Trend
Rising
Institutional interest building

📊 Analyze Any Stock

Enter a ticker symbol to see how it measures up against O'Neil's criteria

Try: NVDA, AVGO, CRM, PANW, APP, or any US stock ticker

Example Results

Companies matching O'Neil's criteria (for educational purposes only)

📚 Educational Data Updated: Delayed data for learning purposes
Company Ticker Q EPSA EPSROERS Leader
NVIDIA
Semiconductors
NVDA 72%48%42%97 Leader
Broadcom
Semiconductors
AVGO 34%28%24%89 Leader
Salesforce
Cloud software
CRM 28%22%21%82 Strong
Palo Alto Networks
Cybersecurity
PANW 18%26%19%78 Building
Meets Criteria
Below Threshold
Market Leader Strongest in its sector

Deep Dive: Understanding O'Neil's Criteria

🔤 CAN SLIM Decoded

Each letter in CAN SLIM is a checklist item O'Neil requires before buying:

  • C — Current earnings: Quarterly EPS up 25%+ year-over-year, and accelerating
  • A — Annual earnings: 3-5 year average EPS and revenue growth of 25%+
  • N — New things: New product, new management, or new stock highs
  • S — Supply & demand: Floating shares are limited; volume is rising
  • L — Leader: RS rating above 80; buy the strongest, not the cheapest
  • I — Institutional: Smart money (mutual/ hedge funds) is accumulating
  • M — Market direction: The overall market must be in an uptrend

📊 Relative Strength: Buy Winners

O'Neil's most counterintuitive rule: don't buy cheap stocks — buy strong ones:

  • RS Rating: A 0-100 score of how a stock outperforms the S&P 500 over 12 months
  • Above 80: The stock is in the top 20% of all stocks — a true leader
  • Why It Works: Strong stocks tend to keep going strong; weak stocks keep going weak
  • The Trap: Waiting for a "cheap" dip often means catching a falling knife

🚀 The Cup-with-Handle Pattern

O'Neil's signature chart pattern appears before most big breakouts:

  • The Cup: Stock rises, pulls back in a rounded "U" shape over 1-6 months
  • The Handle: A small, tight pullback near the top — the "shakeout"
  • The Pivot: Buy when price breaks above the handle on 40%+ above-average volume
  • Stop Loss: Cut losses at 7-8% below your buy price — no exceptions