Are you looking for 2025 Magic Formula stock ideas worldwide? This article introduces the Magic Formula, a simple, research-backed strategy created by Joel Greenblatt. It helps you find great companies at bargain prices using two key factors: earnings yield and return on capital.
Even better, we’ve improved the formula by adding momentum, boosting returns by over 600%. You’ll also get a list of top Magic Formula stocks worldwide for 2025 and step-by-step instructions on how to use this strategy today.
Estimated Reading Time: 6 minutes
Are you tired of trying to beat the market but not getting anywhere? I have great news - you can beat the market by using a simple formula that has worked for over 15 years. It's called the Magic Formula, and it helps you find great companies at bargain prices.
You don't need to be a stock market genius or spend hours studying companies. The Magic Formula does all the hard work for you. It looks at two simple things - how cheap a company is and how well it uses its money. Best of all, you can get these ideas with just a few mouse clicks.
Why the Magic Formula Works
The Magic Formula was created by Joel Greenblatt, a highly successful investor who wrote "The Little Book That Still Beats the Market." He wanted to make investing simple for everyone. The formula looks at earnings yield (how cheap a company is) and return on capital (how well the company uses its money).
Think of the Magic Formula like a shopping list that helps you find quality items on sale. Just like you love finding your favourite brands at a discount, the Magic Formula helps you find great companies when they're cheap.
This method has beaten the market by a wide margin since 2006.
How We Improved the Magic Formula
We've made the Magic Formula even better by testing it with other factors. The biggest improvement came when we added momentum - looking at how well the stock has done in the past six months. This simple change boosted returns by over 600% in our tests.
Our improved version gives you the best of both worlds. You get quality companies at low prices that are also moving up in price. This means you're more likely to make money and less likely to buy "value traps" - cheap stocks that keep getting cheaper.
Look at the returns in column Q1. They show the returns generated by first selecting the best Magic Formula companies (most undervalued) and then sorting them by the items in the Factor 2 column.
Best combination +783% was Momentum
This means you could have earned the highest return of 783.3% over 12 years if you invested in the best ranked Magic Formula companies that also had the highest 6 month price index (price momentum).
Global Magic Formula Investment Ideas for 2025
Here are the best Magic Formula stocks from around the world right now.
We've done all the hard work for you by screening more than 22,000 companies using the Magic Formula strategy. These companies are both cheap and making good money.
Magic Formula only investment ideas
This is what the screen looked like:
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All countries world-wide included
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Top 20% Magic Formula companies
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Minimum daily trading volume of $100,000
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Minimum company market value of $100 million
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Financial statements updated in the last 6 months
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Results sorted by Magic Formula from best to worse
| Name | Country | MF Rank |
|---|---|---|
| DoubleDown Interactive Co., Ltd. | South Korea | 47 |
| Huuuge, Inc. | USA | 93 |
| CoinShares International Limited | Sweden | 94 |
| DoubleUGames Co., Ltd. | South Korea | 118 |
| SIGA Technologies, Inc. | USA | 137 |
| The Westaim Corporation | Canada | 150 |
| Gravity Co., Ltd. | South Korea | 151 |
| FinVolution Group | China | 153 |
| QuantaSing Group Limited | China | 163 |
| FTGroup Co., Ltd. | Japan | 197 |
| Sankyo Co., Ltd. | Japan | 204 |
| Cheryong Electric Co.,Ltd. | South Korea | 209 |
| Gamecard-Joyco Holdings,Inc. | Japan | 210 |
| Mizuho Medy Co.,Ltd. | Japan | 214 |
| PetroNor E&P ASA | Norway | 218 |
| RH PetroGas Limited | Singapore | 228 |
| FMS Enterprises Migun Ltd | Israel | 232 |
| Smiths News plc | Great Britain | 236 |
| Avangaad Berhad | Malaysia | 244 |
| ValueCommerce Co., Ltd. | Japan | 246 |
Magic Formula combined with Price Index 6 month
This is what the screen looked like:
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All countries world-wide included
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Top 10% Magic Formula companies
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Minimum daily trading volume of $100,000
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Minimum company market value of $100 million
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Financial statements updated in the last 6 months
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Results sorted by Price Index 6 months (Momentum) from best to worse
| Name | Country | MF Rank | Price Index 6m |
|---|---|---|---|
| Velan Inc. | Canada | 1,726 | 2.60 |
| Bravura Solutions Limited | Australia | 1,920 | 2.23 |
| Serabi Gold plc | Great Britain | 1,156 | 2.19 |
| Power Solutions International, Inc. | USA | 1,999 | 2.13 |
| Neto M.E Holdings Ltd | Israel | 1,926 | 2.13 |
| Techpoint, Inc. | USA | 1,767 | 2.12 |
| Rimini Street, Inc. | USA | 1,804 | 2.10 |
| JBM (Healthcare) Limited | Hong Kong | 735 | 2.07 |
| Kernel Holding S.A. | Poland | 881 | 1.99 |
| Mesabi Trust | USA | 1,750 | 1.99 |
| El Al Israel Airlines Ltd. | Israel | 781 | 1.95 |
| CI Financial Corp. | Canada | 1,643 | 1.90 |
| DeFi Technologies Inc. | Canada | 2,035 | 1.86 |
| MT Højgaard Holding A/S | Denmark | 454 | 1.81 |
| Palram Industries (1990) Ltd | Israel | 1,640 | 1.81 |
| Ryoyu Systems Co., Ltd. | Japan | 2,038 | 1.81 |
| Quad/Graphics, Inc. | USA | 1,970 | 1.81 |
| Global Link Management Inc. | Japan | 973 | 1.77 |
| Tecnos Japan Incorporated | Japan | 1,524 | 1.67 |
| Lubawa S.A. | Poland | 553 | 1.66 |
Click here to start finding your own Magic Formula ideas NOW!
Best Magic Formula investment ideas in North America for 2025
North America If you prefer investing closer to home, here are the best Magic Formula stocks in the USA and Canada. These companies are easier to research because they follow strict reporting rules. Plus, you won't have to worry about foreign currency changes.
Magic Formula only investment ideas
This is what the screen looked like:
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USA and Canada selected
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Top 20% Magic Formula companies
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Minimum daily trading volume of $100,000
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Minimum company market value of $100 million
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Financial statements updated in the last 6 months
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Results sorted by Magic Formula from best to worse
| Name | Country | MF Rank |
|---|---|---|
| Huuuge, Inc. | USA | 93 |
| SIGA Technologies, Inc. | USA | 137 |
| The Westaim Corporation | Canada | 150 |
| Medical Facilities Corporation | Canada | 270 |
| PROG Holdings, Inc. | USA | 322 |
| Cal-Maine Foods, Inc. | USA | 324 |
| Indivior PLC | USA | 339 |
| ADF Group Inc. | Canada | 352 |
| Dynacor Group Inc. | Canada | 384 |
| RE/MAX Holdings, Inc. | USA | 403 |
| Entrada Therapeutics, Inc. | USA | 424 |
| Alphamin Resources Corp. | Canada | 459 |
| Ironwood Pharmaceuticals, Inc. | USA | 472 |
| Collegium Pharmaceutical, Inc. | USA | 480 |
| GeoPark Limited | USA | 482 |
| Consensus Cloud Solutions, Inc. | USA | 495 |
| biote Corp. | USA | 498 |
| StoneCo Ltd. | USA | 499 |
| Westlake Chemical Partners LP | USA | 509 |
| Puma Biotechnology, Inc. | USA | 513 |
Magic Formula combined with Price Index 6 month
This is what the screen looked like:
-
USA and Canada selected
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Top 10% Magic Formula companies
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Minimum daily trading volume of $100,000
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Minimum company market value of $100 million
-
Financial statements updated in the last 6 months
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Results sorted by Price Index 6 months (Momentum) from best to worse
| Name | Country | MF Rank | Price Index 6m |
|---|---|---|---|
| Velan Inc. | Canada | 1,726 | 2.60 |
| Priority Technology Holdings, Inc. | USA | 2,124 | 2.53 |
| Power Solutions International, Inc. | USA | 1,999 | 2.13 |
| Techpoint, Inc. | USA | 1,767 | 2.12 |
| Rimini Street, Inc. | USA | 1,804 | 2.10 |
| Mesabi Trust | USA | 1,750 | 1.99 |
| CI Financial Corp. | Canada | 1,643 | 1.90 |
| DeFi Technologies Inc. | Canada | 2,035 | 1.86 |
| Quad/Graphics, Inc. | USA | 1,970 | 1.81 |
| Perma-Pipe International Holdings, Inc. | USA | 2,338 | 1.79 |
| Pro-Dex, Inc. | USA | 2,638 | 1.73 |
| Hut 8 Corp. | USA | 2,450 | 1.71 |
| InterDigital, Inc. | USA | 2,119 | 1.62 |
| IBEX Limited | USA | 1,398 | 1.61 |
| Gambling.com Group Limited | USA | 2,466 | 1.58 |
| Aura Minerals Inc. | USA | 1,748 | 1.56 |
| PrimeEnergy Resources Corporation | USA | 1,056 | 1.54 |
| Dillard's, Inc. | USA | 1,881 | 1.52 |
| CompoSecure, Inc. | USA | 2,602 | 1.49 |
| Andean Precious Metals Corp. | Canada | 1,854 | 1.49 |
Click here to start finding your own Magic Formula ideas NOW!
Best Magic Formula investment ideas in Europe for 2025
Europe European companies often trade at lower prices than similar companies in the USA. This means you can find even better bargains. Here are the best European Magic Formula stocks.
Magic Formula only investment ideas
This is what the screen looked like:
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EU countries, Scandinavia and the UK selected
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Top 20% Magic Formula companies
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Minimum daily trading volume of $100,000
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Minimum company market value of $100 million
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Financial statements updated in the last 6 months
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Results sorted by Magic Formula from best to worse
| Name | Country | MF Rank |
|---|---|---|
| CoinShares International Limited | Sweden | 94 |
| PetroNor E&P ASA | Norway | 218 |
| Smiths News plc | Great Britain | 236 |
| Liontrust Asset Management PLC | Great Britain | 260 |
| Avance Gas Holding Ltd | Norway | 294 |
| Record plc | Great Britain | 311 |
| Bure Equity AB (publ) | Sweden | 340 |
| Braemar Plc | Great Britain | 345 |
| S.A. Fountaine Pajot | France | 353 |
| Aker BP ASA | Norway | 355 |
| Rainbow Tours S.A. | Poland | 363 |
| Nordic Paper Holding AB (publ) | Sweden | 372 |
| OKEA ASA | Norway | 377 |
| Sogefi S.p.A. | Italy | 399 |
| Equinor ASA | Norway | 423 |
| RWS Holdings plc | Great Britain | 435 |
| 2020 Bulkers Ltd. | Norway | 442 |
| MT Højgaard Holding A/S | Denmark | 454 |
| Text S.A. | Poland | 473 |
| Supreme Plc | Great Britain | 482 |
Magic Formula combined with Price Index 6 month
This is what the screen looked like:
-
EU countries, Scandinavia and the UK selected
-
Top 10% Magic Formula companies
-
Minimum daily trading volume of $100,000
-
Minimum company market value of $100 million
-
Financial statements updated in the last 6 months
-
Results sorted by Price Index 6 months (Momentum) from best to worse
| Name | Country | MF Rank | Price Index 6m |
|---|---|---|---|
| Serabi Gold plc | Great Britain | 1,156 | 2.19 |
| Kernel Holding S.A. | Poland | 881 | 1.99 |
| MT Højgaard Holding A/S | Denmark | 454 | 1.81 |
| Lubawa S.A. | Poland | 553 | 1.66 |
| VEON Ltd. | The Netherlands | 1,048 | 1.65 |
| Asseco Poland S.A. | Poland | 1,288 | 1.56 |
| Intellego Technologies AB | Sweden | 1,209 | 1.52 |
| Comp S.A. | Poland | 1,596 | 1.42 |
| The Alumasc Group plc | Great Britain | 1,394 | 1.41 |
| CoinShares International Limited | Sweden | 94 | 1.38 |
| ENEA S.A. | Poland | 752 | 1.37 |
| Magyar Telekom | Hungary | 1,308 | 1.36 |
| Imperial Brands PLC | Great Britain | 797 | 1.33 |
| Technip Energies N.V. | France | 1,392 | 1.32 |
| PetroNor E&P ASA | Norway | 218 | 1.31 |
| RCS MediaGroup S.p.A. | Italy | 956 | 1.30 |
| Rainbow Tours S.A. | Poland | 363 | 1.28 |
| Cairo Communication S.p.A. | Italy | 1,344 | 1.28 |
| Trigano S.A. | France | 560 | 1.28 |
| Betsson AB (publ) | Sweden | 697 | 1.27 |
Click here to start finding your own Magic Formula ideas NOW!
Best Magic Formula investment ideas in Asia for 2025
Asia Asian markets often move differently than markets in the West. This helps spread your risk. Here are the best Asian Magic Formula stocks that also trade enough each day so you can easily buy and sell.
Magic Formula only investment ideas
This is what the screen looked like:
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Australia, Hong Kong, Japan, South Korea, New Zealand and Singapore selected
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Top 20% Magic Formula companies
-
Minimum daily trading volume of $100,000
-
Minimum company market value of $100 million
-
Financial statements updated in the last 6 months
-
Results sorted by Magic Formula from best to worse
| Name | Country | MF Rank |
|---|---|---|
| MFF Capital Investments Limited | Australia | 1 |
| DoubleDown Interactive Co., Ltd. | South Korea | 47 |
| DoubleUGames Co., Ltd. | South Korea | 118 |
| Gravity Co., Ltd. | South Korea | 151 |
| FTGroup Co., Ltd. | Japan | 197 |
| Sankyo Co., Ltd. | Japan | 204 |
| Cheryong Electric Co.,Ltd. | South Korea | 209 |
| Gamecard-Joyco Holdings,Inc. | Japan | 210 |
| Mizuho Medy Co.,Ltd. | Japan | 214 |
| RH PetroGas Limited | Singapore | 228 |
| ValueCommerce Co., Ltd. | Japan | 246 |
| Kanematsu Corporation | Japan | 248 |
| NeoPharm CO., LTD. | South Korea | 258 |
| GENOVA, Inc. | Japan | 275 |
| KT Corporation | South Korea | 286 |
| Daikoku Denki Co., Ltd. | Japan | 315 |
| Double Standard Inc. | Japan | 328 |
| Naigai Trans Line Ltd. | Japan | 335 |
| Traders Holdings Co.,Ltd. | Japan | 386 |
| LX Semicon Co., Ltd. | South Korea | 422 |
Magic Formula combined with Price Index 6 month
This is what the screen looked like:
-
Australia, Hong Kong, Japan, South Korea, New Zealand and Singapore selected
-
Top 10% Magic Formula companies
-
Minimum daily trading volume of $100,000
-
Minimum company market value of $100 million
-
Financial statements updated in the last 6 months
-
Results sorted by Price Index 6 months (Momentum) from best to worse
| Name | Country | MF Rank | Price Index 6m |
|---|---|---|---|
| JBM (Healthcare) Limited | Hong Kong | 735 | 2.1 |
| Global Link Management Inc. | Japan | 973 | 1.8 |
| Tecnos Japan Incorporated | Japan | 1,524 | 1.7 |
| Valeura Energy Inc. | Singapore | 702 | 1.6 |
| Greens Co.,Ltd. | Japan | 1,601 | 1.6 |
| Kioxia Holdings Corporation | Japan | 881 | 1.6 |
| AlphaPolis Co., Ltd. | Japan | 564 | 1.5 |
| S&D Co., Ltd | South Korea | 769 | 1.5 |
| Moriya Transportation Engineering and Manufacturing Co.,Ltd. | Japan | 1,699 | 1.5 |
| ID Holdings Corporation | Japan | 1,525 | 1.5 |
| Management Solutions co.,Ltd. | Japan | 1,683 | 1.5 |
| Kusurinomadoguchi, Inc. | Japan | 1,590 | 1.5 |
| Digital Information Technologies Corporation | Japan | 1,388 | 1.4 |
| Sharingtechnology, Inc. | Japan | 1,213 | 1.4 |
| Japan Lifeline Co., Ltd. | Japan | 1,634 | 1.4 |
| RH PetroGas Limited | Singapore | 228 | 1.4 |
| SERAKU Co., Ltd. | Japan | 1,264 | 1.4 |
| NCD Co., Ltd. | Japan | 992 | 1.4 |
| CMC Corporation | Japan | 670 | 1.4 |
| F&F Co., Ltd | South Korea | 841 | 1.4 |
Click here to start finding your own Magic Formula ideas NOW!
How to Implement the Magic Formula In Your Portfolio
Using this strategy is easy. We've already saved the Magic Formula screen in our stock screener. All you need to do is:
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Log in to the screener
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Click the screener icon
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Click "Load"
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Choose "Magic Formula" from the saved screens
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Pick your countries,
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Set your minimum daily trading volume and company size
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Click "Apply"
You can make the strategy even better by adding momentum. Just move the slider under "Price Index 6m" to select companies whose price has gone up the most (the top 40% of all companies) in the past six months. This simple change has boosted returns by over 600% in our tests.
Why Act Now
Right now, is a great time to use the Magic Formula strategy. Markets have been up and down lately, which means there are more chances to find good companies at low prices. Plus, many investors are worried about the economy, making them sell good companies for less than they're worth.
The best part about starting now is that you can build your portfolio slowly. Buy a few companies each month until you own 30-40 stocks.
This way you spread your risk and don't have to worry if one company does poorly.
Next Steps
Here's what you should do next:
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Load the Magic Formula screen
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Start building your watch list
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Buy your first Magic Formula stock
You don't have to do this alone. We're here to help you every step of the way.
Our screener makes finding these companies easy, and our newsletter keeps you updated on new opportunities.
Click here to start finding your own Magic Formula ideas NOW!
Remember, investing doesn't have to be complicated. The Magic Formula gives you a simple, proven way to find good companies at bargain prices.
Why not get started right now?
FREQUENTLY ASKED QUESTIONS
1. Does the Magic Formula really work, or is it just another stock-picking gimmick?
Yes, the Magic Formula works. It was created by Joel Greenblatt, a well-known investor, and has beaten the market since 2006. The formula finds great companies at cheap prices by looking at earnings yield (how cheap a company is) and return on capital (how well it uses its money).
2. I don’t have time to research stocks every day. Can I still use the Magic Formula?
Absolutely! That’s the beauty of this strategy. The Magic Formula removes the need for deep company research. With a few clicks, you can find a list of stocks that fit the formula. You only need to update your portfolio once every six months or yearly, making it perfect for busy investors.
3. How many stocks should I buy when using the Magic Formula?
The best results come from owning 30-40 stocks. This spreads your risk so that if one company underperforms, it won’t hurt your portfolio too much. You don’t need to buy all stocks at once. You can start with a few each month until you reach your target.
4. What if a stock in my Magic Formula portfolio drops in price? Should I sell it?
Not necessarily. The formula picks undervalued stocks, which means they might take time to perform. A drop in price could make it even cheaper, which is a good thing. However, if it no longer fits the Magic Formula criteria when you rebalance your portfolio, it is time to sell and replace it with a better-ranked stock.
5. Can I use the Magic Formula in different markets, or is it only for U.S. stocks?
You can use it globally! We screen over 22,000 companies worldwide, so you can find Magic Formula stocks in North America, Europe, and Asia. If you prefer investing closer to home, you can filter results by region.
6. How do I avoid buying “value traps” with the Magic Formula?
A value trap is a stock that looks cheap but keeps getting cheaper. That’s why we improved the strategy by adding momentum—only selecting Magic Formula stocks that have been moving up in price over the last six months. This simple change helps avoid stocks that stay cheap for a reason.
7. How do I get started with the Magic Formula right now?
It’s easy. Log into our stock screener, load the saved Magic Formula screen, pick your preferred regions, set a minimum trading volume for liquidity, and apply the filter. From there, build a portfolio by buying a few top-ranked stocks each month until you reach 30–40 stocks.
Click here to start finding your own Magic Formula ideas NOW!
