Company Analysis Questions

Automated Warren Buffett - Comprehensive Investment Analysis Framework

563
Total Questions
24
Categories
4
Agent Perspectives

Core Thesis: AGI by 2030

Every analysis assumes AGI arrives within 5 years. Long-term holding period: 5-10 years. All questions should be answered with this lens.

Generation Methodology

Agent 1: First Principles

Bottom-up reasoning about business fundamentals, moats, and intrinsic value. Buffett/Munger mental models.

Agent 2: Web Research

Researched frameworks from Buffett, Munger, Pabrai, Dorsey, Damodaran, Greenblatt, and Porter.

Agent 3: Contrarian/Adversarial

Short-seller perspective, forensic accounting, competitive destruction, and downside scenarios.

Agent 4: Quantitative

Specific metrics, ratios, benchmarks, and data-driven analysis with ideal thresholds.

Table of Contents

1. Business Model & Moat30 questions 2. Revenue & Growth27 questions 3. Profitability & Margins22 questions 4. Balance Sheet & Financial Health24 questions 5. Cash Flow Analysis18 questions 6. Management & Governance30 questions 7. Valuation25 questions 8. Risk Analysis29 questions 9. Industry & Competitive Position21 questions 10. AGI Impact Analysis (Critical - Core Thesis)64 questions 11. Shareholder Returns & Capital Allocation16 questions 12. Insider & Institutional Activity13 questions 13. Macro, Secular Trends & Geopolitics18 questions 14. Optionality & Hidden Assets22 questions 15. Downside Protection & Margin of Safety18 questions 16. Customer & Supplier Dynamics22 questions 17. Regulatory & Legal20 questions 18. Forensic Accounting & Quality of Earnings24 questions 19. Historical Pattern Analysis15 questions 20. Scenario Analysis & Position Sizing20 questions 21. Quantitative Metrics Checklist (Quick Scan)20 questions 22. M&A, Ecosystem & Information Edge18 questions 23. Geopolitical, Culture & ESG22 questions 24. Cascading Failures & Meta-Questions25 questions

1. Business Model & Moat

30 questions
1.What exactly does this company sell, and to whom?
2.Can you explain the business model to a 10-year-old?
3.What is the company's core competitive advantage (moat)?
4.Is the moat widening, stable, or narrowing over time? What evidence supports this?
5.How would you categorize the moat: brand, network effects, switching costs, cost advantages, intangible assets, or regulatory?
6.Could a well-funded competitor replicate this business from scratch? What would it cost and how long would it take?
7.What is the company's pricing power? Can they raise prices without losing customers?
8.How does the company make money on each transaction (unit economics)?
9.What percentage of revenue is recurring vs one-time?
10.How diversified are revenue streams? What happens if the largest one declines 50%?
11.Is the business capital-light or capital-heavy?
12.What are the barriers to entry in this industry?
13.Does the company benefit from economies of scale? Are there still scale advantages to be gained?
14.Is this a platform business? If so, how strong are the network effects?
15.What would Warren Buffett say about this company's moat in one sentence?
16.How defensible is this business against Big Tech (Apple, Google, Microsoft, Amazon) entering the space?
17.Is the company a price-maker or price-taker?
18.What is the customer's cost of switching away from this product/service?
19.Does the company have any natural monopoly or oligopoly characteristics?
20.How asset-light is this business? What is the ratio of tangible assets to revenue?
21.What is the company's reinvestment rate and return on incremental invested capital?
22.Does the company have a 'toll booth' business model where it clips a percentage of economic activity?
23.Is the product/service a 'must-have' or a 'nice-to-have'?
24.What percentage of customer spending does this product represent (share of wallet)?
25.How embedded is the product in customer workflows? What is the integration depth?
26.Could this business exist without the internet? (Tests for genuine digital moat vs legacy business with a website)
27.What is the replacement cycle for the company's product/service?
28.Does the company benefit from data network effects (more users = more data = better product)?
29.Is the moat structural (embedded in industry dynamics) or executional (dependent on current management)?
30.How would a short seller attack this company's moat thesis?

2. Revenue & Growth

27 questions
1.What is the revenue CAGR over 3, 5, and 10 years?
2.What is organic growth vs acquisition-driven growth?
3.What is the total addressable market (TAM) and how is it calculated? Is the TAM methodology reasonable or inflated?
4.What percentage of TAM has been penetrated?
5.What are the key growth drivers for the next 3-5 years?
6.Is revenue growth accelerating or decelerating? What is the second derivative?
7.What is the geographic breakdown of revenue? Which regions are growing fastest?
8.Is there seasonality in the revenue? How does Q4 compare to Q1?
9.What is revenue per user/customer and how is it trending?
10.Are there any new products or segments that could become material (>10% of revenue) in 3-5 years?
11.What is the net revenue retention rate (for SaaS/subscription businesses)?
12.How dependent is growth on new customer acquisition vs expansion of existing customers?
13.What is the customer acquisition cost (CAC) trend? Is it getting more or less expensive to grow?
14.What is the LTV/CAC ratio?
15.Is the company gaining or losing market share? At what rate?
16.What is the company's same-store/same-unit growth rate (organic growth from existing operations)?
17.How much of the growth is from pricing vs volume?
18.What is the implied growth rate at the current stock price? Is the market pricing in too much or too little growth?
19.Are there revenue concentration risks? What % comes from top 5 customers?
20.What is the backlog or deferred revenue trend? Does it signal acceleration or deceleration?
21.How correlated is the company's growth with GDP? Is it cyclical or secular?
22.What would need to happen for revenue to decline 20%+ in a single year?
23.Is there a flywheel effect? Does growth compound on itself?
24.What is the user/subscriber growth rate and how does it compare to revenue growth?
25.Are there any upcoming catalysts that could accelerate growth?
26.What does the S-curve look like for this company's main product? Are they early, mid, or late stage?
27.How does the company's growth compare to its closest 3 competitors?

3. Profitability & Margins

22 questions
1.What are the gross, operating, and net margins? How do they compare to peers?
2.What is the 5-year trend in each margin?
3.What is driving margin expansion or contraction?
4.What are incremental margins on new revenue?
5.What is the operating leverage of the business? How much does a 10% revenue increase flow to operating income?
6.What is the fixed vs variable cost structure?
7.What is the ROIC and how does it compare to WACC?
8.What is the ROE decomposition (DuPont analysis: margin x turnover x leverage)?
9.What is the ROA and how asset-efficient is the business?
10.At what revenue level would margins plateau? What are peak margins for this business model?
11.Are there any one-time items inflating or depressing current margins?
12.What is SBC (stock-based compensation) as a percentage of revenue? Is it distorting reported profitability?
13.How does profitability change across business segments?
14.What is R&D spending as a percentage of revenue? Is it maintenance or growth R&D?
15.What is the marginal cost of serving an additional customer?
16.How sensitive are margins to input cost changes (labor, materials, energy)?
17.What is the company's contribution margin by product/segment?
18.Has the company achieved operating leverage historically? (Revenue growth > opex growth)
19.What is EBITDA margin and how does it compare to FCF margin? Large gaps indicate quality issues.
20.What is the sustainable margin for this business over a full economic cycle?
21.Is the company sacrificing current margins for future growth? Is that trade-off rational?
22.What is revenue per employee and profit per employee vs peers?

4. Balance Sheet & Financial Health

24 questions
1.What is net debt / EBITDA? Is the company under- or over-levered?
2.What is the interest coverage ratio?
3.What is the current ratio and quick ratio?
4.What is the debt maturity schedule? Any large maturities in the next 3 years?
5.What is the mix of fixed vs floating rate debt?
6.Does the company have investment-grade credit ratings?
7.What is on the balance sheet that isn't obvious (hidden assets or liabilities)?
8.What is the goodwill/intangibles as a percentage of total assets? Is there impairment risk?
9.What is the cash and short-term investments balance?
10.Does the company have off-balance-sheet obligations (operating leases, purchase commitments, guarantees)?
11.What is the pension funding status (for companies with defined benefit plans)?
12.What is the working capital trend? Is the company becoming more or less capital efficient?
13.What is the cash conversion cycle (days sales outstanding + days inventory outstanding - days payable outstanding)?
14.Is inventory growing faster than revenue? (Potential red flag)
15.Are accounts receivable growing faster than revenue? (Potential red flag)
16.What is the company's net cash position (cash minus total debt)?
17.Has the company ever needed emergency financing or had covenant issues?
18.What is the total leverage ratio including off-balance-sheet items?
19.Is the balance sheet strong enough to survive a severe recession?
20.What is tangible book value per share?
21.Does the company have any contingent liabilities from lawsuits or guarantees?
22.What is the debt-to-equity ratio and how does it compare to the industry?
23.What is the altman Z-score or other bankruptcy risk metric?
24.Could the company fund operations for 2+ years with zero revenue using existing cash?

5. Cash Flow Analysis

18 questions
1.What is free cash flow (FCF) and FCF per share?
2.What is the FCF yield (FCF / market cap)?
3.What is the FCF conversion ratio (FCF / net income)? Consistently above 1.0 is ideal.
4.What is capex as a percentage of revenue? Maintenance capex vs growth capex split?
5.What is the trend in operating cash flow over 5 years?
6.Is working capital a source or use of cash? What is the trend?
7.What is owner earnings (Buffett's preferred metric: net income + depreciation - maintenance capex)?
8.How much of reported earnings convert to actual cash?
9.What is the capex-to-depreciation ratio? (>1 suggests growth investment, <1 suggests underinvestment)
10.Are there any large non-recurring cash items distorting FCF?
11.What is the dividend coverage ratio (FCF / dividends paid)?
12.What is the cash flow from financing activities trend? Is the company a net issuer or net returner of capital?
13.How volatile is FCF? What is the coefficient of variation over 10 years?
14.What is the relationship between capex cycles and revenue growth? (Tests capital efficiency)
15.Can the company self-fund its growth or does it need external capital?
16.What is the cash tax rate vs statutory rate? Are there tax advantages that boost cash flow?
17.Is there a divergence between accrual earnings and cash earnings? (Potential quality issue)
18.What is the cumulative FCF over the past 5 years vs cumulative net income? Large gaps are red flags.

6. Management & Governance

30 questions
1.Who is the CEO and what is their track record?
2.Is the CEO the founder? If not, how long have they been in the role?
3.What is executive compensation relative to company performance? Is pay aligned with shareholder returns?
4.What percentage of executive compensation is in stock vs cash? What are the vesting conditions?
5.How much stock does the CEO/management team own? (Skin in the game)
6.Has management been buying or selling shares in the open market?
7.What is the board composition? How many truly independent directors?
8.Are there any related-party transactions or conflicts of interest?
9.What is management's stated capital allocation strategy? Do their actions match their words?
10.What is the company's track record on M&A? What has been the ROI on past acquisitions?
11.Has management ever issued equity at low valuations or done value-destructive buybacks at high prices?
12.What does management say about competitive threats in earnings calls? Are they honest or dismissive?
13.What is the executive turnover rate? Have key people left recently?
14.Is there a clear succession plan?
15.Does the company have dual-class share structure? What are the governance implications?
16.What is management's track record of delivering on guidance?
17.How does Glassdoor rating trend? What do employees say about company culture and leadership?
18.Has the CEO or CFO ever been involved in accounting issues or SEC investigations?
19.Is the company managed for long-term value creation or short-term earnings management?
20.What is the CEO's communication style? Do they underpromise and overdeliver?
21.Does management have a history of empire-building (growing revenue at the expense of returns)?
22.What is the CEO's incentive structure? What metrics are they optimizing for?
23.Has the company ever restated earnings?
24.What is the auditor's opinion? Any qualified opinions or going concern notices?
25.Is the CFO credible and transparent? How long have they been in the role?
26.How does management allocate capital between: (a) organic reinvestment, (b) M&A, (c) buybacks, (d) dividends, (e) debt reduction?
27.What is the historical return on each capital allocation category?
28.Are there any poison pills, staggered boards, or other anti-takeover provisions?
29.Does management discuss risks honestly in 10-K filings or is it boilerplate?
30.What is the ratio of CEO pay to median employee pay? How does it trend?

7. Valuation

25 questions
1.What is the current P/E ratio (trailing and forward)?
2.What is EV/EBITDA and EV/FCF?
3.How do current multiples compare to 5-year and 10-year averages?
4.How do current multiples compare to the sector median?
5.What is the PEG ratio? Is growth adequately reflected in the price?
6.What is the price-to-sales ratio?
7.What is the DCF-implied fair value using conservative assumptions?
8.What discount rate (WACC) is appropriate and why?
9.What terminal growth rate is the market implying?
10.What earnings growth rate is the market pricing in?
11.What is the margin of safety at the current price?
12.What would you pay for this business if it were private (private market value)?
13.What is the sum-of-the-parts valuation? Are there hidden assets the market isn't pricing?
14.What is the reverse DCF implied growth rate? Is it achievable?
15.At what price would this be a screaming buy? At what price would you sell?
16.What is the earnings yield (E/P) compared to the 10-year Treasury yield?
17.What multiple expansion/contraction is realistic over the next 5 years?
18.How does the company's valuation compare to recent M&A transactions in the industry?
19.What is the company worth if growth stops entirely (steady-state value)?
20.What would intrinsic value be under bear, base, and bull scenarios?
21.Is there a catalyst that could close the gap between price and value?
22.What is the normalized earnings per share (adjusting for cycle and one-time items)?
23.What is the 52-week range position? Distance from all-time high?
24.Is the stock trading above or below replacement value of assets?
25.What is the historical valuation range during recessions vs expansions?

8. Risk Analysis

29 questions
1.What are the top 3 existential risks to this business?
2.What could cause a permanent loss of capital (not just temporary price decline)?
3.What is the regulatory risk? Are there pending regulations that could impair the business model?
4.What is the litigation risk? Are there material pending lawsuits?
5.What is the technology disruption risk?
6.What is the competitive risk? Who is the most dangerous competitor and why?
7.What is the customer concentration risk?
8.What is the geographic/geopolitical risk?
9.What is the key person risk? What happens if the CEO leaves tomorrow?
10.What is the currency risk for international operations?
11.What is the commodity/input cost risk?
12.How exposed is the business to interest rate changes?
13.How exposed is the business to recession? What happened in 2008 and 2020?
14.Is there obsolescence risk? Could the product become irrelevant?
15.What is the cybersecurity risk? What would a major data breach cost?
16.Is there political risk (government contracts, subsidies, tariffs)?
17.What is the ESG risk? Are there environmental liabilities?
18.Is there supply chain concentration risk?
19.What is the risk of a debt downgrade?
20.What black swan events could destroy >50% of company value?
21.What is the risk-reward ratio? How much upside vs downside from current price?
22.What would make you sell this stock after buying it?
23.Is there a scenario where this company goes to zero? What would cause it?
24.What are the unknown unknowns? What risks might we not be thinking about?
25.How correlated is this stock with the broader market (beta)?
26.What is the maximum drawdown this stock has experienced historically?
27.Is there a risk of forced selling (index deletion, regulation, sanctions)?
28.What tail risks does the company face that are not in the 10-K risk factors?
29.Could AI/automation make this company's workforce a liability (expensive to restructure)?

9. Industry & Competitive Position

21 questions
1.What is the industry structure? (Monopoly, oligopoly, fragmented, perfect competition)
2.Where is the industry in its lifecycle? (Emerging, growth, mature, declining)
3.What is the industry's growth rate and how does the company compare?
4.Who are the top 5 competitors and what is each one's competitive advantage?
5.What is the company's market share and how has it changed over 5 years?
6.What is the industry's HHI (Herfindahl-Hirschman Index) concentration?
7.What are Porter's Five Forces for this industry? (Threat of entry, substitutes, buyer power, supplier power, rivalry)
8.Is this a winner-take-all or winner-take-most market?
9.What is the industry's typical return on capital? Is this company above or below average?
10.Are there secular tailwinds or headwinds for this industry?
11.What is the industry's sensitivity to economic cycles?
12.Has there been significant M&A consolidation in the industry?
13.What is the threat of new entrants, specifically from Big Tech?
14.Is the industry being disrupted by technology? By whom?
15.What is the pace of innovation in this industry?
16.Are there regulatory barriers that protect incumbents?
17.What is the industry's typical capital intensity?
18.How does pricing power vary across the industry?
19.What is the industry's typical customer churn rate?
20.Is there a regulatory or technological inflection point approaching?
21.How does this company's cost structure compare to the lowest-cost competitor?

10. AGI Impact Analysis (Critical - Core Thesis)

64 questions
1.If AGI arrives by 2030, does this company benefit, get destroyed, or remain neutral?
2.What percentage of this company's workforce could be replaced by AGI/advanced AI?
3.What would the cost structure look like post-AGI? How much could labor costs decline?
4.Does the company have proprietary data assets that become more valuable with AGI?
5.Is the company's product something that AGI would make obsolete?
6.Could AGI enable the company to enter entirely new markets?
7.What is the company's current AI/ML investment and capability?
8.Is the company an AI enabler (sells picks and shovels) or an AI consumer?
9.How quickly could this company adopt and deploy AGI capabilities?
10.What is the company's compute infrastructure? Do they have access to sufficient AI compute?
11.Does the company have the engineering talent to leverage AGI effectively?
12.In an AGI world, does the moat strengthen or weaken?
13.Which competitors would benefit more from AGI, potentially closing the competitive gap?
14.What new competitors could emerge in an AGI world that don't exist today?
15.How would AGI change the company's TAM (expand or contract)?
16.What is the company's AI patent portfolio? Any defensible IP in AI?
17.How dependent is the company on human expertise that AGI could replicate?
18.Could AGI commoditize the company's core product or service?
19.What is management's stated AI strategy? Is it credible or hand-wavy?
20.How much of revenue comes from activities that could be fully automated by AGI?
21.What is the company's relationship with AI infrastructure providers (Nvidia, cloud providers)?
22.Does the company have unique training data that would give it an AGI advantage?
23.In a post-AGI world, what becomes the scarce resource this company controls?
24.Could AGI enable a 10x improvement in the company's core product? Or a competitor's?
25.What regulatory framework around AGI would benefit or harm this company?
26.How would AGI affect the company's customer acquisition costs?
27.Would AGI make the company's distribution advantage more or less valuable?
28.In the transition period (2025-2030), what AI-driven opportunities does the company have?
29.What is the risk that AGI makes the entire industry irrelevant?
30.Could AGI enable perfect price discrimination, improving or destroying the company's pricing power?
31.How would AGI affect the company's supply chain and logistics?
32.Does the company's brand matter in a post-AGI world, or do brands become less relevant?
33.What physical assets does the company have that retain value regardless of AGI?
34.Could AGI-powered competitors offer the same service at 90% lower cost?
35.How would AGI affect government regulation of this industry?
36.What is the company's competitive position specifically in AI/ML talent recruitment?
37.Is the company investing enough in AI to remain competitive, or will it be disrupted?
38.What happens to this company if open-source AGI becomes available to everyone?
39.Does the company have any 'moats within moats' that survive even AGI disruption?
40.What is the second-order effect of AGI on this company's customers and suppliers?
41.If AGI makes knowledge work free, what happens to this company's value proposition?
42.Could AGI enable the company to achieve near-perfect operational efficiency?
43.What is the company's data flywheel? Does AGI accelerate or break it?
44.In a world with AGI, would you rather own this company or its competitors? Why?
45.What percentage of the company's current R&D spend could be replaced by AGI?
46.How quickly could AGI replicate the company's institutional knowledge?
47.Does the company control any physical or legal bottleneck that AGI cannot route around?
48.What is the company's exposure to AI-generated content flooding its platform/market?
49.Could AGI enable perfect demand forecasting, eliminating inventory/capacity risk?
50.What happens to this company's margins if AGI reduces software development costs by 90%?
51.Is the company positioned to capture value from AGI, or will value accrue to AGI providers?
52.What is the most bullish AGI scenario for this company? The most bearish?
53.How would AGI affect the company's ability to innovate and launch new products?
54.Does the company face an 'AI investment trap' where they must spend billions just to maintain competitiveness?
55.What happens to this company if AI coding agents replace most software engineers?
56.Could AGI disintermediate the company (remove it from the value chain)?
57.What percentage of customer interactions could AGI handle autonomously?
58.How would AGI affect the competitive dynamics in the company's industry overall?
59.If every company has access to AGI, what differentiates this company?
60.What unique assets (data, relationships, regulatory licenses, physical infrastructure) would protect this company in an AGI world?
61.Could AGI create entirely new product categories that this company is well-positioned to serve?
62.What is the risk that AGI development is concentrated among a few companies, creating new competitive threats?
63.How would the company's valuation change if AGI arrives in 2027 vs 2030 vs 2035?
64.Is the company building or buying AI capabilities? Which strategy is more sustainable?

11. Shareholder Returns & Capital Allocation

16 questions
1.What is the total shareholder return over 1, 3, 5, and 10 years?
2.What is the dividend yield and dividend growth rate?
3.What is the payout ratio (dividends / earnings and dividends / FCF)?
4.How many consecutive years of dividend growth?
5.What is the buyback yield (net shares repurchased / market cap)?
6.Has the company been buying back shares at good prices (below intrinsic value)?
7.What is the total capital return (dividends + buybacks) as a percentage of FCF?
8.How has share count changed over 5 and 10 years?
9.Is the company destroying value through share issuance (dilution from SBC)?
10.What is the return on retained earnings? For every $1 retained, how much market value was created?
11.What is the CAGR of intrinsic value per share (not just stock price)?
12.Does the capital allocation framework make sense for this stage of the company's lifecycle?
13.Is there an active or announced share repurchase authorization? How much remains?
14.What is the company's dividend track record during recessions?
15.Is the company prioritizing the right capital allocation lever (reinvestment vs return)?
16.How much FCF is allocated to each: reinvestment, M&A, buybacks, dividends, debt reduction?

12. Insider & Institutional Activity

13 questions
1.What is the net insider buying/selling over the past 12 months (dollar amount)?
2.What percentage of shares are owned by insiders?
3.Have any directors made large personal purchases recently?
4.What is the institutional ownership percentage?
5.Who are the top 10 institutional holders and what are their recent position changes?
6.Are any notable value investors or superinvestors in the stock? Have they been adding or trimming?
7.What is the 13F filing trend for hedge funds (net buying or selling)?
8.Has insider selling been routine (10b5-1 plans) or discretionary?
9.Are insiders buying at current prices or only exercising options and selling?
10.What is the short interest as a percentage of float? Days to cover?
11.Is short interest increasing or decreasing?
12.What is the cost to borrow shares (signals short demand)?
13.Are there any activist investors involved or likely to become involved?

13. Macro, Secular Trends & Geopolitics

18 questions
1.What macroeconomic factors most affect this company?
2.How sensitive is revenue to GDP growth?
3.How sensitive is the company to interest rate changes?
4.What secular trends (demographics, technology, regulation) support or threaten this business?
5.How does inflation affect this company (positive, negative, or neutral)?
6.What is the company's exposure to foreign exchange risk?
7.Is the company a beneficiary of any major government spending programs?
8.What geopolitical risks could affect the company (trade wars, sanctions, conflict)?
9.What is the company's exposure to China and the risk of decoupling?
10.How would a severe recession (GDP -5%) affect this company's revenue and profitability?
11.Is the company positioned for a higher-rate or lower-rate environment?
12.What demographic trends affect the company's long-term demand?
13.How does energy cost affect the company's operations?
14.What tax law changes could materially affect the company?
15.Is the company benefiting from or threatened by deglobalization?
16.What is the company's exposure to political risk in operating countries?
17.How does the company handle sanctions and export control compliance?
18.Are there climate change risks or opportunities for this company?

14. Optionality & Hidden Assets

22 questions
1.What valuable assets does the company have that aren't reflected in the stock price?
2.Are there any 'free options' embedded in the business (new products, markets, technologies)?
3.Does the company own valuable real estate, IP, or data that isn't on the balance sheet at fair value?
4.Are there any business segments that could be worth more as standalone entities?
5.Could the company be an acquisition target? For whom and at what premium?
6.Does the company have any strategic investments or JVs that are undervalued?
7.Is there a potential spin-off or separation that could unlock value?
8.What is the value of the company's customer relationships/installed base?
9.Does the company have unused pricing power (deliberately pricing below what the market would bear)?
10.Are there regulatory changes on the horizon that could unlock new markets for the company?
11.Does the company have brand value that isn't fully monetized?
12.What is the optionality value of the company's R&D pipeline?
13.Could the company license its technology to create a new revenue stream?
14.Is there a subscription or recurring revenue model the company could adopt?
15.Does the company have international expansion opportunities it hasn't pursued?
16.What is the value of the company's ecosystem (developers, partners, integrations)?
17.Are there any call options on commodity prices or other inputs?
18.Does the company have excess capacity that could be monetized?
19.What strategic value does the company have to a larger acquirer?
20.Are there any 'lottery ticket' scenarios where a small probability event creates massive upside?
21.Does the company have accumulated tax losses (NOLs) that have significant value?
22.What is the company's workforce quality and what is the replacement cost of its human capital?

15. Downside Protection & Margin of Safety

18 questions
1.What is the worst-case scenario and how much could you lose?
2.What is the downside to tangible book value?
3.What would the company be worth in a liquidation?
4.How much of the current market cap is supported by existing cash flows vs future growth expectations?
5.What is the 'no-growth' value of the company (value if it never grows again)?
6.How much of the purchase price is protected by hard assets?
7.What is the base rate for companies like this losing >50% of value?
8.In the worst recession scenario, does the company remain profitable?
9.Can the company cut costs fast enough to remain FCF-positive in a downturn?
10.What is the breakeven revenue level (revenue at which the company earns zero profit)?
11.Is there a floor on the stock price from strategic value or asset value?
12.How quickly could the company deleverage if needed?
13.What is the probability-weighted expected return accounting for downside scenarios?
14.Is the current price at or near a historical valuation floor?
15.How many quarters of poor earnings would trigger significant debt covenant issues?
16.Is the dividend safe in a recession? What is the minimum FCF needed to cover it?
17.What would it take for this investment thesis to be completely wrong?
18.What is the Kelly Criterion optimal position size given the risk/reward profile?

16. Customer & Supplier Dynamics

22 questions
1.Who are the company's most important customers?
2.What is customer concentration (top 10 customers as % of revenue)?
3.What is the customer retention/churn rate?
4.What is the Net Promoter Score (NPS) or customer satisfaction metric?
5.How long is the average customer relationship?
6.What is the customer switching cost in dollar terms?
7.How price-sensitive are the company's customers?
8.What is the customer's total cost of ownership (TCO) for the product?
9.What alternatives do customers have? How differentiated is the offering?
10.Who are the company's key suppliers?
11.What is supplier concentration? Is there a single-source dependency?
12.What is the company's bargaining power relative to suppliers?
13.Are input costs a significant portion of COGS? Which inputs?
14.Could the company vertically integrate to reduce supplier risk?
15.What is the risk of a key supplier becoming a competitor?
16.How long are customer contracts and what is the renewal rate?
17.What is the company's market position in the value chain (how much value does it capture)?
18.Are there any supply constraints that could limit growth?
19.What is the company's inventory management efficiency?
20.Does the company have long-term supply agreements or is it spot-market dependent?
21.How would a tariff or trade disruption affect the supply chain?
22.What is the risk that customers bring the company's service in-house?

17. Regulatory & Legal

20 questions
1.What are the key regulations governing this business?
2.Are there pending regulatory changes that could materially affect operations?
3.What is the cost of regulatory compliance as a percentage of revenue?
4.Does the company benefit from regulatory barriers to entry?
5.What is the antitrust risk? Is the company a target for antitrust action?
6.Are there any pending material lawsuits? What is the potential exposure?
7.Has the company ever been fined or sanctioned by regulators?
8.What is the company's lobbying spend and political exposure?
9.How would changes in data privacy laws (GDPR, CCPA-type) affect the business?
10.Is the company subject to price regulation in any market?
11.What is the intellectual property risk (patent trolls, IP disputes)?
12.Are there any environmental remediation liabilities?
13.What is the company's tax structure? Is there risk from international tax reform?
14.How does the company handle compliance across multiple jurisdictions?
15.Is the industry subject to periodic regulatory crackdowns?
16.What would happen if the company lost a key license or permit?
17.Are there any whistleblower or qui tam lawsuits?
18.What is the risk of new legislation specifically targeting this company or industry?
19.How would AI regulation (if enacted) affect this company?
20.What is the total contingent liability from all legal matters?

18. Forensic Accounting & Quality of Earnings

24 questions
1.Is there a gap between reported earnings and cash flow? Why?
2.What is the accruals ratio? (High accruals = lower earnings quality)
3.Are revenue recognition policies aggressive or conservative?
4.Has the company changed accounting policies recently? Why?
5.What are the critical accounting estimates and how sensitive are results to changes in assumptions?
6.Is depreciation policy reasonable relative to actual asset useful lives?
7.Are there any signs of channel stuffing (shipping product to hit targets)?
8.Is the company capitalizing expenses that should be expensed (e.g., software development costs)?
9.What is the trend in days sales outstanding (DSO)? Rising DSO can signal revenue quality issues.
10.What is the trend in days payable outstanding (DPO)? Rising DPO can mean cash flow is being manufactured.
11.Are there significant related-party transactions?
12.What is the company's effective tax rate vs statutory rate? Big gaps need explanation.
13.Has the company ever restated financials?
14.What does the auditor's report say? Any emphasis paragraphs or qualified opinions?
15.Is stock-based compensation properly accounted for in adjusted metrics?
16.Are there large 'other income' or 'special items' that recur regularly? (They're not actually special)
17.What is the quality of the company's deferred revenue? Is it genuine future revenue or accounting manipulation?
18.Are there any non-GAAP metrics the company highlights that differ significantly from GAAP?
19.What is the trend in inventory turnover? Declining turnover may signal demand issues.
20.Is the company using aggressive assumptions for pension obligations or warranty reserves?
21.Are there any large adjustments to comprehensive income that don't appear in net income?
22.What percentage of revenue comes from long-term contracts with significant estimation?
23.Is the company's goodwill testing process rigorous or designed to avoid impairment?
24.What do short sellers say about the company's accounting?

19. Historical Pattern Analysis

15 questions
1.How did the stock perform during the 2008 financial crisis?
2.How did the stock perform during COVID-19 (2020)?
3.How did the stock perform during the 2022 rate hike cycle?
4.What was the maximum peak-to-trough drawdown in each major downturn?
5.How long did recovery take after each major drawdown?
6.What happened to revenue and earnings during past recessions (not just stock price)?
7.Has the company ever cut its dividend? Under what circumstances?
8.What is the stock's historical beta during bull vs bear markets?
9.How has the company's market share changed through economic cycles?
10.What is the company's track record of capital allocation during downturns? Did they buy back stock cheap?
11.Has the company ever made a transformative acquisition? What was the outcome?
12.What was the stock price doing 1, 3, and 5 years after its IPO?
13.What is the longest period of flat or declining stock price, and what caused it?
14.Has the company successfully pivoted its business model in the past?
15.What is the company's track record of entering new markets or launching new products?

20. Scenario Analysis & Position Sizing

20 questions
1.What is the bull case (25th percentile outcome)? What assumptions drive it?
2.What is the base case (50th percentile)? What assumptions drive it?
3.What is the bear case (75th percentile outcome)? What assumptions drive it?
4.What is the catastrophic case (95th percentile)? Could you lose permanently?
5.What is the probability-weighted expected return across scenarios?
6.What position size is appropriate given the risk/reward and your conviction level?
7.What is the Kelly Criterion optimal bet size?
8.What are the key variables that differentiate the bull and bear cases?
9.What leading indicators would tell you which scenario is playing out?
10.At what price would you double the position? At what price would you cut it?
11.What would change your mind about the thesis (kill criteria)?
12.What is the 5-year IRR under each scenario?
13.How does correlation with your existing portfolio affect position sizing?
14.What is the liquidity risk? Can you exit the position easily if needed?
15.What is the opportunity cost of owning this vs your next best idea?
16.What is the timeline for the thesis to play out? What if it takes longer?
17.What exogenous events (outside the company's control) could invalidate each scenario?
18.How does the probability distribution of outcomes change if AGI arrives in 2027 vs 2030 vs never?
19.What is the expected return per unit of risk (modified Sharpe-like ratio for the thesis)?
20.What would need to be true for this to be a 10-bagger from current prices?

21. Quantitative Metrics Checklist (Quick Scan)

20 questions
1.P/E ratio: trailing ___ forward ___. vs 5yr avg ___ vs sector ___. [Ideal: below historical avg and sector]
2.EV/EBITDA: ___. vs 5yr avg ___ vs sector ___. [Ideal: below 12x for quality company]
3.EV/FCF: ___. [Ideal: below 20x, below 15x is attractive]
4.FCF Yield: ___%. [Ideal: above 5%, above 7% is very attractive]
5.ROIC: ___%. 5yr avg ___%. [Ideal: consistently above 15%, trending up]
6.ROE: ___%. DuPont: margin ___% x turnover ___ x leverage ___. [Ideal: above 15% without excessive leverage]
7.Gross margin: ___%. 5yr trend: ___. [Ideal: stable or expanding, above industry avg]
8.Operating margin: ___%. 5yr trend: ___. [Ideal: expanding, above peer average]
9.Net debt/EBITDA: ___x. [Ideal: below 2x, below 1x is strong]
10.Interest coverage: ___x. [Ideal: above 5x, above 10x is very strong]
11.FCF conversion (FCF/Net Income): ___%. [Ideal: consistently above 80%, above 100% is great]
12.Revenue CAGR (5yr): ___%. [Ideal: above 10% for growth, above 5% for value]
13.Insider ownership: ___%. Net buying/selling: $___. [Ideal: meaningful ownership, net buying]
14.Short interest: ___% of float. Days to cover: ___. [Ideal: below 5%, below 3 days]
15.Share count change (5yr): ___%. [Ideal: declining, indicating buybacks exceed dilution]
16.Dividend yield: ___%. Payout ratio: ___%. Growth (5yr CAGR): ___%. [Ideal: sustainable payout, growing dividend]
17.SBC as % of revenue: ___%. [Ideal: below 5% for mature companies, watch trend]
18.Accruals ratio: ___%. [Ideal: below 5%, negative is best]
19.Altman Z-score: ___. [Ideal: above 3.0 (safe zone)]
20.Current ratio: ___. Quick ratio: ___. [Ideal: current >1.5, quick >1.0]

22. M&A, Ecosystem & Information Edge

18 questions
1.Has the company made any transformative acquisitions? What was the ROI?
2.What is the company's M&A track record (successful integration vs value destruction)?
3.Is the company likely to be an acquirer or a target?
4.What is the premium the company typically pays for acquisitions?
5.Are there obvious acquisition targets that would strengthen the company's position?
6.Does the company have a developer ecosystem or platform that creates lock-in?
7.What is the size and engagement level of the company's developer community?
8.Does the company have partner integrations that increase switching costs?
9.What is the company's API strategy? Does it enable or limit ecosystem growth?
10.Do you have an information edge on this company that the market doesn't have?
11.What do customers, competitors, and former employees say about the company?
12.Are there any expert networks or primary research insights available?
13.What is the bull case that the market is underweighting?
14.What is the bear case that the market is underweighting?
15.Is this a consensus or non-consensus bet? Where does the crowd disagree?
16.What do sell-side analysts miss about this company?
17.What would a private equity firm do differently if they owned this company?
18.Is there a structural reason why this stock is mispriced (index exclusion, neglect, complexity)?

23. Geopolitical, Culture & ESG

22 questions
1.What is the company's carbon footprint and trajectory?
2.Does the company face stranded asset risk from energy transition?
3.What is the company's water usage and exposure to water scarcity?
4.Does the company have any human rights issues in its supply chain?
5.What is the company's board diversity (gender, ethnicity, expertise)?
6.What is the company's ESG rating from major agencies? Is it improving?
7.Are there ESG fund inclusion/exclusion catalysts on the horizon?
8.Does the company publish a sustainability report? Is it substantive or performative?
9.What is the company's culture like? (Innovation-driven, bureaucratic, sales-driven, engineering-driven)
10.Does the company attract and retain top talent?
11.What is the company's employer brand strength?
12.Is the company's culture scalable as it grows?
13.Does the company have a missionary or mercenary culture?
14.How does the company handle failures and mistakes? (Learn vs blame)
15.What is the speed of decision-making? (Fast and decentralized vs slow and bureaucratic)
16.How aligned are employees with the company's mission?
17.What is the company's exposure to geopolitical decoupling (US-China, etc.)?
18.How would a major regional conflict affect the company's operations?
19.What is the company's exposure to sanctions risk?
20.Does the company have operations in countries with high political instability?
21.How diversified is the company's geographic footprint?
22.What is the company's exposure to currency wars or capital controls?

24. Cascading Failures & Meta-Questions

25 questions
1.What happens if two major risks materialize simultaneously?
2.Is there a scenario where AGI disruption + recession + regulatory action all hit at once?
3.What cascading failures could a single adverse event trigger?
4.If the stock drops 50%, would you buy more? Why or why not?
5.What is the one question about this company that, if you knew the answer, would determine whether to invest?
6.What is the consensus view on this stock, and why might it be wrong?
7.What does the market understand about this company that you might be missing?
8.If you could only look at one metric to evaluate this company, what would it be?
9.Would you want to own this business for 10 years if the stock market closed tomorrow?
10.Is this a business you would want your children to inherit?
11.How confident are you in your ability to accurately value this company? (1-10)
12.What is your biggest blind spot in analyzing this company?
13.Is this investment within your circle of competence?
14.What would a skeptic say about your thesis?
15.Is this company better or worse than the average company in your portfolio?
16.What is the expected value of this analysis itself? Are you spending the right amount of time?
17.If every assumption in your model is off by 20%, does the investment still work?
18.What would make this a asymmetric opportunity (limited downside, massive upside)?
19.Is there a simpler or better way to express this investment thesis?
20.What is the one thing that, if it changed, would make this a 10x better or worse investment?
21.How would a completely rational, emotionless investor evaluate this opportunity?
22.What cognitive biases might be affecting your analysis of this company?
23.Is this investment thesis falsifiable? What evidence would disprove it?
24.Rate the overall quality of this business on a scale of 1-10 and justify your rating.
25.Final question: Given everything above, what is your conviction level (1-10) and optimal position size?