Even when you use a cut off of 100% plus and 5 cents, you will get lot of candidates during earning season meting the criteria. When the earning season is in peak, you might get 30 -40 candidate meeting the criteria in a day. Over the many earnings seasons of trading it I have found certain things help in finding the best ones.
This is most important. Low floats ones are the one which really climb out ferociously. Now to trade the low float stocks, you need some understanding of how those stocks trade. In many cases the bid ask spread will be huge. The intra day swings are large. Unless you have stomach for volatility and extremely good risk management, it can be very bumpy ride. The thing to remember is that the earnings catalyst is going to last for some weeks so not getting shaken out of such plays is key. These are the ones which give you the best return.
One of the best trade I had in this strategy was IDSA in 2004. It had only 1.7 million float broke out on earnings day and went up from 3 to 21 in around 15 days ( I got stopped out at 18).
Prior Price Action
A weakness or consolidation prior to earnings of 20 to 65 days is ideal. I always pick the ones with 65 day growth being low when faced with a choice of many. If a stock has been rallying for sometime, I try and avoid it unless it has a weakness prior to earnings.
Like in the ' Virgin' strategy, if you find a first major acceleration in stocks life span or first major after 3 or 4 years, then there is moon shot rally. Obviously because it was a major surprise for most market participants. Earlier I had built a earnings database of last 10 years of stocks history and built a scan to pick based on breakout to highest level based on that, but it was too expensive and time consuming to get the data plus matching data from old sources is difficult.
People who have misconceptions like all gaps get filled and the stock is overextended or overbought will have very difficult time trading this. Stocks gap up 15-20 dollars on earnings day or 100 to 300% and still keep going.
One of the problem anyone trying to trade this strategy will find is kid in candy store kind of excitement as you see several of the ones quickly making 10 to 20% moves after your entry. Locking in profit is the key and selectivity is the key in selecting the trades in this.