Oversold Quality Stock Screen Results

Screen Type: Oversold Quality (超卖的好公司) Date: January 8, 2026 Session ID: a1aedff5-9817-4b85-8e0b-9fd6a33f1abb Philosophy: Contrarian value - buying quality on weakness

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Executive Summary

This screen attempted to identify high-quality companies that have been temporarily oversold. After comprehensive analysis, the screen reveals significant concerns with most candidates.

Overall Verdict: PASS ON ALL CANDIDATES

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Market Context

• VIX Level: 15.06-15.40 (normal range, slightly elevated)
• Market Sentiment: Neutral to cautious
• Sector Pressure: Consumer staples, packaged foods showing weakness

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Key Findings

Critical Issues Detected

1. 2 Stocks DISQUALIFIED - Negative ROE violates "quality" criteria

   • CRWD: ROE -8.82%
   • AZO: ROE -73.17% (buyback-driven)

2. High Leverage Across Board - 5 of 6 stocks have D/E >190%

   • This is financial leverage, not quality

3. Cyclical Businesses at Peak - 4 of 6 are cyclical

   • "Oversold" may signal cycle turning down

4. Deteriorating Fundamentals - 3 of 6 showing weakness

   • CPB: EBIT guidance -9% to -13%
   • LW: Structural margin pressure
   • AZO: Missed Q1 2026 earnings

Validation Status

Overall Data Confidence: LOW (only 20% validated)

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Candidate Profiles

1. Lamb Weston (LW) - ELIMINATE

Why It's Oversold: 32% drop due to margin pressure, competitive pricing Why "Quality Intact" Is FALSE:

• Commodity frozen potato processor, not premium brand
• No pricing power
• High debt (D/E 223%)

Bear Case: Restaurant traffic declines + input costs stay elevated = stock falls 25-35%

2. CrowdStrike (CRWD) - ELIMINATE

Why It's Oversold: RSI hit 27.6, below 50-day MA Why "Quality Intact" Is FALSE:

• NEGATIVE ROE (-8.82%) = destroys capital
• 30x sales valuation with decelerating growth
• Microsoft competitive threat

Bear Case: Growth slows to 15% = stock falls 35-45%

3. Marathon Petroleum (MPC) - WAIT FOR CYCLE

Why It's Oversold: Identified in oversold territory Why "Quality" Is MISLEADING:

• Pure cyclical refining business
• 18.89% ROE reflects peak-cycle margins
• Net margin only 3.46%

Bear Case: Crack spreads normalize = stock falls 30-40%

4. AutoZone (AZO) - CAUTION

Why It's Oversold: Missed Q1 2026 earnings Why "Quality" Is MISLEADING:

• NEGATIVE ROE (-73.17%) from negative equity
• Financial engineering, not operational quality
• Cannot access equity markets if needed

Bear Case: Recession + refinancing issues = stock falls 25-30%

5. Campbell's (CPB) - ELIMINATE

Why It's Oversold: 36% below 52-week high Why "Quality Intact" Is FALSE:

• EBIT guidance -9% to -13% for FY2026
• Snack segment struggles
• Tariff headwinds worsening

Bear Case: EBIT decline accelerates = stock falls 15-25%

6. Deere (DE) - WAIT FOR CYCLE BOTTOM

Why It's Oversold: 16% below Morningstar fair value Why BEST CANDIDATE:

• Consistent ROE 20.43-20.61%
• Strong FCF $3.23B
• Current ratio 2.22

Concerns: High D/E 246%, ag cycle turning down Bear Case: Farm incomes fall further = stock falls 30-35%

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Quality Assurance Summary

Validation (investment-validator)

• Status: WARNINGS DETECTED
• Critical Issues: ROE discrepancies, RSI unverified, API access limited
• Action Required: Configure production APIs, verify ROE against SEC filings

Critical Review (investment-critic)

• Status: HIGH RISK
• Finding: Screening methodology confuses "oversold" with "undervalued" and "quality" with "cyclical at peak"
• Recommendation: PASS on all 6 candidates, recalibrate screening criteria

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Recommendations

Immediate Actions

1. REMOVE CRWD and AZO (negative ROE)
2. VERIFY LW ROE against SEC 10-K
3. CALCULATE RSI independently

Better Screening Criteria

QUALITY FILTER:
- ROE >15% for 10 consecutive years
- D/E <50%
- Positive FCF every year
- Gross margin stable

OVERSOLD FILTER:
- RSI <30
- Fundamental catalyst for recovery
- 2-3 quarters of stabilization evidence

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Files Generated

1. session.json - Session metadata
2. summary.md - This executive summary
3. query.md - Original screen request
4. agents/validator/result.md - Full validation report
5. agents/critic/result.md - Full critical review

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Data Sources

• MarketBeat - Oversold Stocks
• Stock Analysis - Oversold Stocks
• CNBC - VIX
• Yahoo Finance
• Trefis - S&P 500 52-Week Lows

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Session ID: a1aedff5-9817-4b85-8e0b-9fd6a33f1abb Storage Path: .agent-results/sessions/2026-01-08/a1aedff5-9817-4b85-8e0b-9fd6a33f1abb/ Candidates Stored: 6