Use LongbridgeAI to screen for "deeply fallen and rebounding" established stocks + a practical guide to options strategies
I'm LongbridgeAI, I can summarize articles.Using LongbridgeAI to screen "Deep Drop & Recovery" Blue-Chip Stocks + Options Strategy Practical Guide
Longbridge granted me StockPro Pro access. I tested it over the weekend and compared the results with other AIs, finding them quite satisfactory.
Investment is, from a certain perspective, a mathematical problem. It requires understanding what you are doing, at least seeking certainty amidst uncertainty.
You need your own judgment. Although the recommendation included two tickers, I only chose one: ORCL. I bought today out of fear of missing out (FOMO). At the same time, I am concerned that it has already risen significantly, worrying about a pullback and the impact of tomorrow's economic data release, so I decided to buy in batches.
Introduction
As a US stock investor, I have always been looking for those "blue-chip companies with solid fundamentals but significant stock price pullbacks and early signs of recovery." These tickers have a solid business foundation as a safety cushion and ample room for rebound to provide elasticity. Recently, I completed a full screening and analysis process using LongbridgeAI, from initial screening to deep fundamental analysis, and finally to LEAPS options strategy design. The entire process was very efficient.
This article will fully review my analysis process for reference by fellow Longbridge community members.
Step 1: Define Screening Criteria
I presented my initial requirements to LongbridgeAI:
Find old-line companies similar to IBM, MRVL, and ORCL that have dropped nearly half, yet maintain good fundamentals and show signs of stock price recovery.
LongbridgeAI helped clarify the screening criteria:
- Drawdown from 52-week high ≥25%
- Stable fundamentals (revenue growth, profit margin, cash flow)
- Recent signs of recovery (positive 10-day gain)
- Reasonable valuation or at historical lows
Step 2: Initial Screening + Comprehensive Scoring
LongbridgeAI pulled price, valuation, and financial data for candidate tickers via API and performed comprehensive scoring. The screened 8 core tickers:
| Rank | Ticker | Business Direction | Distance from 52W High | PE (Current) | PE (5Y Median) | Comprehensive Score |
|---|---|---|---|---|---|---|
| 1 | ACN | IT Consulting | -38% | 14.5 | 27.3 | 8.2 |
| 2 | ORCL | Enterprise Cloud/Database | -57% | 24.3 | 31.5 | 8.1 |
| 3 | NOW | Enterprise ITSM | -36% | 72.8 | 139.0 | 8.0 |
| 4 | ADBE | Creative Software | -29% | 14.6 | 37.9 | 7.9 |
| 5 | CRM | CRM/AI Agents | -28% | 19.1 | 71.6 | 7.7 |
| 6 | SAP | ERP/Cloud | -30% | 25.4 | 33.4 | 7.3 |
| 7 | QCOM | Mobile/AI Chips | -35% | 18.5 | 17.2 | 6.9 |
| 8 | SNPS | EDA | -34% | 100.6 | 58.8 | 6.9 |
Key Findings: ACN and ORCL scored highest overall, mainly because:
- ACN: PE of 14.5 is only half of the 10-year median, 3.8% dividend yield, Vanguard increased holdings by 40 million shares
- ORCL: Largest rebound space in the field at 133%, explosion in AI Data Center CapEx, FY2026 revenue +17%
Step 3: Deep Fundamental Analysis
For each ticker, a deep breakdown was conducted. LongbridgeAI called upon:
- Company Basic Info API
- Financial Statements API (Income Statement, Balance Sheet, Cash Flow Statement)
- Financial Metrics API
- Historical Business Revenue Composition
- Shareholder Information
- Latest News Updates
ACN (Accenture) Deep Analysis Summary
Financial Performance:
- FY2025 Revenue $69.7 Billion (+7.4%), Operating Margin 15.6%, Net Income $7.7 Billion
- Operating Cash Flow $11.5 Billion (+26%), Free Cash Flow $10.9 Billion, FCF Margin 15.6%
- Cash $11.5 Billion, Net Cash Position
Valuation:
- PE 14.5 (10-year low, only 53% of the median)
- PS 1.5 (10-year low)
- PB 3.5 (10-year low)
Institutional Moves: Vanguard increased holdings by 40 million shares; BlackRock/Morgan Stanley/JPMorgan Chase increased holdings
Catalysts: Large AI transformation orders from financial firms like UniCredit; Explosion in demand for AI consulting services
Risks: AI automation of entry-level consulting work (structural threat); Goodwill $22.5 Billion accounts for 35% of total assets
ORCL (Oracle) Deep Analysis Summary
Financial Performance:
- FY2026 Revenue $67.4 Billion (+17%), Operating Margin 33.2% (5-year high), Net Income $17.1 Billion (+37%)
- Operating Cash Flow $32.0 Billion, but CapEx $55.7 Billion (crazy construction of AI Data Centers), FCF turned negative
Valuation:
- PE 24.3 (23% below 5-year median)
- PS 6.1 (close to median)
- Founder Larry Ellison holds 40.2% stake
Institutional Moves: BlackRock reduced holdings by 4.55 million shares; but Capital Research/Geode/UBS/Morgan Stanley increased holdings
Catalysts: Explosion in AI Data Center demand; OCI cloud revenue high growth; Long-term portion of deferred revenue surged 307%
Risks: Whether the "burning cash model" of CapEx $55.7 Billion/year + Debt $122.3 Billion can generate sufficient returns
Step 4: Options Strategy Design
After determining ORCL and ACN as the final two tickers, I had LongbridgeAI perform LEAPS options analysis.
Why choose the ORCL + ACN combination?
| Dimension | ORCL (Oracle) | ACN (Accenture) |
|---|---|---|
| Rebound Space | **133%** (Largest in field) | 62% (Largest in second tier) |
| Core Logic | Explosion in AI Data Center CapEx | PE 14.5 (10-year low) + 3.8% dividend floor |
| Return Elasticity | +318% when recovering 75% | +231% when recovering 75% |
| Certainty | Moderate (CapEx risk) | Highest (Double insurance of valuation + cash flow) |
| Role Positioning | Offensive Spear | Defensive Shield |
One bets on elasticity, one bets on certainty; the combination balances offense and defense.
Expiration Date Selection: Why March 2027 (7 months)?
I had LongbridgeAI compare three expiration dates: February, March, and June:
| Expiration | ORCL Premium | Breakeven | Return at 75% Recovery | Monthly Decay | Time Buffer |
|---|---|---|---|---|---|
| Feb (6 months) | $26.77 | +13.5% | +383% | $4.46/month | Tight (5 months to recover) |
| Mar (7 months) | $29.40 | +15.2% | +318% | $4.20/month | Adequate (6 months to recover) |
| Jun (10 months) | $35.56 | +19.4% | +228% | $3.56/month | Excessive (Premium too expensive) |
Conclusion: March offers 1 extra month of buffer compared to February, costing only 10% more premium; it is 20% cheaper than June while offering 40% higher returns.
Recommended Contracts
| Ticker | Expiration | Strike Price | Premium | Delta | Breakeven |
|---|---|---|---|---|---|
| ORCL | March 2027 | $140 (Lightly ITM -5%) | ~$29.4/share | 0.65 | $169 (vs Current Price +15%) |
| ACN | March 2027 | $165 (Lightly ITM -6%) | ~$32.2/share | 0.67 | $197 (vs Current Price +13%) |
Why choose lightly In-The-Money (ITM) rather than ATM?
- Delta ~0.66 means 66% of the premium is intrinsic value
- Lower proportion of time value, stronger resistance to theta decay
Step 5: Position Building Rhythm Design
Worried about "missing out," LongbridgeAI provided a batched position building strategy:
Total budget $50,000, split into two batches:
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Batch 1: Buy now ($16,500, 33%) ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ ORCL: ~340 shares × $29.4 = ~$10,000 ACN: ~200 shares × $32.2 = ~$6,400 ✅ Solves "fear of missing out" — if the stock price rises directly without pulling back, your 33% position is making money ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Batch 2: Buy when August pulls back 8-12% ($33,500, 67%) ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Assuming ORCL pulls back to ~$132 (-10%), ACN pulls back to ~$158 (-10%) ORCL: ~870 shares × ~$25 (cheaper premium) = ~$21,750 ACN: ~530 shares × ~$24 (cheaper premium) = ~$12,700 ✅ Cheaper premium = More shares = Larger return multiple ⚠️ If the pullback is deeper than expected (-15%), Batch 2's return multiple is larger ⚠️ If no pullback occurs, your existing 33% position won't completely miss out ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Total: ORCL ~1,210 shares + ACN ~730 shares = Investment ~$50,850 ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━Step 6: Scenario Analysis
LongbridgeAI provided portfolio returns under different scenarios:
| Scenario | ORCL Target Price | ACN Target Price | Portfolio Value | Return Rate |
|---|---|---|---|---|
| Stock Price Sideways (No rise, no fall) | $147 | $176 | ~$16,500 | -67% |
| Recover 50% | $244 | $231 | ~$173,000 | +247% |
| Recover 75% | $293 | $258 | ~$252,000 | +405% |
| Direct Rise 30% (No Pullback) | $191 | $228 | ~$108,000 | +116% |
Risk Scenarios:
- Best: Shallow pullback (-5%), rapid 75% recovery → +580%
- Base Case: 10% pullback, 50% recovery → +195%
- Conservative: 10% pullback, 30% recovery → +45%
- Pessimistic: 15% pullback, only 20% recovery → -55%
- Worst: 15% pullback, no recovery → -100%
Summary: Insights on Using LongbridgeAI
1. Data-Driven, Avoiding Subjective Speculation
The entire analysis process was based entirely on data:
- Prices, valuations, and financial data all came from APIs
- Comprehensive scoring model objectively quantified
- Institutional holding changes clearly visible
2. Multi-Dimensional Analysis, No Key Information Missed
LongbridgeAI considered simultaneously:
- Fundamentals (Revenue, Profit, Cash Flow)
- Valuation (PE/PB/PS vs Historical Comparison)
- Technicals (Price Position, Momentum Indicators)
- Funds (Institutional Holding Changes)
- Catalysts (Latest News Updates)
3. Flexible Strategy Design, Adapting to Different Scenarios
From initial screening to options strategies, LongbridgeAI provided:
- Comparison of multiple expiration dates
- Comparison of multiple strike prices
- Comparison of multiple position-building rhythms
- Multiple scenario analyses
4. Adequate Risk Warnings
LongbridgeAI warned of risks at every stage:
- Maximum option loss = Total premium paid
- ORCL's CapEx risk
- ACN's AI disruption risk
- Goodwill impairment risk
- Recommend setting take-profit lines
Advice for Community Members
- Clarify your investment logic: Are you betting on elasticity or certainty? Short-term rebound or long-term recovery?
- Build positions in batches: Do not go all-in at once. Use a strategy of buying 1/3 now + 2/3 waiting for a pullback to balance the risk of missing out.
- Choose lightly ITM options: Delta ~0.65-0.70, low time value proportion, resistant to decay.
- Set take-profit lines: When returns reach +100%, sell at least half to lock in profits.
- Continuous Tracking: Monitor earnings reports, institutional holding changes, and catalyst progress.
Appendix: LongbridgeAI Tools Used in This Analysis
- Price Data API: Real-time quotes, K-line data, technical indicators
- Financial Data API: Income Statement, Balance Sheet, Cash Flow Statement
- Valuation Metrics API: PE/PB/PS vs Historical Percentile Comparison
- Institutional Holdings API: Major Shareholder Holding Changes
- News API: Latest News Updates and Catalysts
- Options Pricing Model: Black-Scholes Model calculation for Premium, Delta, Breakeven
- Scenario Analysis: Multi-Scenario Return Simulation
Disclaimer: This article is merely a demonstration of the investment analysis process and does not constitute investment advice. Options trading carries high risk and may result in the loss of all principal. Investors should make prudent decisions based on their own risk tolerance.
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