The generating functionals for the local composite operators, Φ2(x) and Φ4(x), are used to study excitations in the scalar quantum field theory with λ Φ4 interaction. The effective action for the composite operators is obtained as a series in the Planck constant ℏ, and the two- and four-particle propagators are derived. The numerical results are studied in the space–time of one dimension, when the theory is equivalent to the quantum mechanics of an anharmonic oscillator. The effective potential and the poles of the composite propagators are obtained as series in ℏ, with an effective mass and an effective coupling determined by nonperturbative gap equations. This provides a systematic approximation method for the ground state energy, and for the second and fourth excitations. The results show quick convergence to the exact values, better than that obtained without including the operator Φ4(x).