Quick answer: AlphaLens runs every stock through 15 structured research frameworks — starting with what the company actually does and ending with a clear long-term thesis you can act on. Use them in order, start to finish, and you'll cover the same ground a professional analyst covers before putting real money into a stock.
This guide walks through all 15 frameworks — what each one is, what questions it answers, how to use it step by step, and how it connects to the others. Jump to any framework using the list below, or read straight through to see how they build on each other.
Want all 15 run on one ticker in a single pass? That's what the Run All feature is for — it applies every framework below to the stock you're researching and returns a complete analysis in one shot.
In short: Before you look at the stock price, understand the business. This framework gives you a plain-English picture of what the company does, how it makes money, and where it sits in its industry.
Many investors jump straight to the stock price or valuation numbers, which often leads to confusion. This framework forces you to understand the business first — the way a professional analyst would.
Questions it answers: - What does this company actually do? - How does it make money? - Who are its main customers? - What products or services drive most of its revenue? - Is the business simple to understand or complicated? - Where does the company sit in its industry?
How to use it, step by step: 1. Start with the basics. Ask: "In one or two sentences, what does this company do?" Write the answer in plain English. If you can't explain it simply, you don't understand it yet. 2. Look at how the company makes money. Ask: "Where does the revenue come from?" Break it down by product, service, or segment, and note which are growing and which are shrinking. 3. Identify the customers. Ask: "Who buys from this company?" Everyday people, other businesses, or governments? The customer type helps you judge how stable the revenue might be. 4. Note key strengths and weaknesses early. Ask: "What stands out as a clear advantage or problem?" You don't need deep analysis yet — just capture the obvious points. 5. Use this as your foundation. Everything that follows — moat analysis, valuation, risk — builds on this overview. A weak foundation makes the rest of the analysis less reliable.
When to use it: At the very beginning of researching any new stock. Never skip it.
Common mistakes beginners make: - Skipping the overview and jumping straight to the chart or valuation. - Using jargon instead of plain language. - Assuming they understand the business when they only recognize the product name.
Investor perspective: Peter Lynch said investors should find out what the company behind the stock is actually doing. This framework turns that advice into a repeatable process.
Connects to: Feeds directly into Bull vs Bear + Moat Analysis and the rest of the framework sequence.
In short: Build the strongest case for the stock and the strongest case against it — with equal effort — then test whether the company has a durable competitive advantage protecting it.
Most people naturally focus on reasons a stock might go up. This framework trains you to take the opposite view just as seriously, which is one of the biggest differences between average and better analysis.
Questions it answers: - What is the strongest case for why this stock could do well? - What is the strongest case for why this stock could do poorly? - Does the company have a real competitive advantage? - How durable is that advantage? - Is the bull case stronger and more realistic than the bear case?
How to use it, step by step: 1. Write the bull case first. Ask: "What is the best realistic version of the future for this company?" List the main positive drivers in plain language. 2. Write the bear case with equal effort. Ask: "What is the most serious realistic downside?" Don't soft-pedal the risks — treat this with the same seriousness as the bull case. 3. Evaluate the moat. Does the company have something competitors find hard to copy? Is the advantage based on brand, cost, switching costs, network effects, or something else? How long is it likely to last? 4. Compare the two sides. Ask: "Which case looks more probable and more durable?" This comparison helps you avoid one-sided thinking. 5. Decide how much weight to give the analysis. A wide, durable moat strengthens the overall thesis; a weak or narrowing moat raises the risk level.
When to use it: After you understand the basic business (Full Company Breakdown) and before detailed valuation work.
Common mistakes beginners make: - Only writing the bull case and ignoring the risks. - Calling something a "moat" when it's really just a temporary advantage. - Assuming a strong brand automatically means a wide moat.
Investor perspective: Warren Buffett has said a truly great business must have an enduring moat that protects excellent returns on invested capital. This framework helps you test whether that kind of advantage actually exists.
Connects to: Sits between the company overview and the Fair Value Stress Test — a clear bull case, bear case, and moat view makes the valuation work more realistic.
In short: Don't estimate what a stock is worth once — estimate it three ways (optimistic, base case, pessimistic) to see how much margin of safety you actually have at today's price.
Many people look at a single valuation number, but markets rarely follow one exact path. Stress testing shows you what happens if things go better or worse than expected.
Questions it answers: - What is a reasonable estimate of the company's value in a normal scenario? - What happens to the value if growth or margins are stronger than expected? - What happens if growth or margins are weaker than expected? - How much of a discount (margin of safety) does the current price offer? - What has to go right for the stock to be a good investment at today's price?
How to use it, step by step: 1. Build a base-case valuation using reasonable growth rates, margins, and multiples. 2. Create an optimistic case by raising key assumptions in a believable way — not fantasy numbers. 3. Create a pessimistic case by lowering growth, margins, or multiples to reflect realistic downside. 4. Compare the current price to the range. Where does today's price sit relative to the base, bull, and bear values? 5. Decide what the valuation is telling you. A large margin of safety supports a stronger thesis; a price that only works in the optimistic case is riskier.
When to use it: After you understand the business and competitive position — valuation without context is often misleading.
Common mistakes beginners make: - Using only the most optimistic assumptions. - Relying on a single valuation method. - Ignoring how sensitive the value is to small changes in growth or margins.
Investor perspective: Benjamin Graham — Warren Buffett's mentor — taught the importance of a margin of safety: buying with enough cushion that mistakes or bad luck don't destroy capital. This framework puts that idea into practice.
Connects to: Turns the qualitative work from earlier frameworks into concrete numbers and prepares you for the Long-Term Investment Thesis.
In short: High reported profits don't always mean high-quality profits. This framework checks whether earnings are backed by real cash flow or propped up by aggressive accounting.
Accounting rules give companies some flexibility in how they report results. This framework helps you look past headline numbers to the economic reality underneath.
Questions it answers: - Are the reported earnings backed by real cash flow? - Are there large or growing gaps between earnings and cash generation? - Is the company using aggressive accounting choices? - How consistent have earnings been over time? - Can I trust these numbers for valuation purposes?
How to use it, step by step: 1. Compare earnings to cash flow. Is the company converting reported profits into actual cash? Look at operating cash flow relative to net income. 2. Check for red flags — unusual items, large accruals, or aggressive revenue recognition that can make earnings look better than the underlying business. 3. Review consistency over time. Stable, predictable earnings are generally higher quality than earnings that jump around. 4. Decide how much weight to give the numbers. High quality means you can rely more on the earnings for valuation; low quality calls for more caution.
When to use it: Whenever earnings look strong on the surface, or when a stock is priced for continued high growth.
Common mistakes beginners make: - Taking reported earnings per share at face value. - Ignoring the difference between earnings and cash flow. - Focusing only on the most recent quarter instead of multi-year patterns.
Investor perspective: Warren Buffett has pointed to a high return on equity capital, achieved without undue leverage or accounting gimmicks, as the real test of managerial performance. This framework helps you check for those gimmicks.
Connects to: Protects the Fair Value Stress Test and the overall thesis from relying on low-quality earnings numbers.
In short: A clear, written summary of why you believe a stock is worth owning for several years — including the specific conditions that would prove you wrong.
Without a clear thesis, it's easy to react emotionally to short-term price moves. A written long-term thesis helps you stay focused on the bigger picture and decide whether temporary drops are opportunities or warning signs.
Questions it answers: - Why do I believe this company can grow or create value over the next 3–5 years or longer? - What are the 3–5 strongest reasons supporting this view? - What would have to change for this thesis to be wrong? - How does the current valuation fit with the long-term story? - Am I willing to hold through normal market ups and downs?
How to use it, step by step: 1. Summarize the core idea in one or two clear sentences — why you want to own this stock for the long term, in simple language. 2. List the key supporting points. Focus on business quality, competitive advantages, growth drivers, and management. 3. Identify the main risks and invalidators. What specific events or changes would make this thesis no longer valid? Being honest here strengthens the analysis. 4. Check the valuation fit. Does the current price give you a reasonable chance of a good long-term return if the thesis plays out? 5. Write a short monitoring plan. What will you watch over time to see if the thesis is still on track?
When to use it: Near the end of your research, after you have examined the business, risks, and valuation.
Common mistakes beginners make: - Writing a thesis that is too vague or too optimistic. - Failing to define what would prove the thesis wrong. - Changing the thesis every time the stock price moves.
Investor perspective: Warren Buffett has long emphasized owning wonderful businesses for the long term when the price is reasonable. A clear written thesis helps you follow that approach with discipline.
Connects to: Serves as the final synthesis that draws on Portfolio Risk & Fit, Catalyst Calendar, Management Quality Scorecard, and the other analyses.
In short: The SEC-mandated Pay Versus Performance table from the company's latest proxy statement, quoted exactly as filed — compensation actually paid to executives versus company and peer-group shareholder returns, with no verdict on whether the pay was justified.
Questions it answers: - What did the company report for each named executive's Summary Compensation Table (SCT) total versus Compensation Actually Paid (CAP)? - How did total shareholder return compare to the disclosed peer group over the same years? - What company-selected performance measure did the filer choose to link pay to results? - Did more than one person serve as principal executive officer in a given year, and how is that reported? - What is Compensation Actually Paid, and how is it different from a take-home paycheck?
How to use it, step by step: 1. Pull the year-by-year table as filed. SCT total, CAP, average NEO figures, and peer-group TSR — copied from the table, not estimated. 2. Check whether pay tracked returns. A rising CAP alongside falling shareholder return is worth a second look; so is the reverse. 3. Read the company-selected measure on its own terms. It's issuer-specific — don't compare one company's measure value directly to another's. 4. Remember what CAP actually is. It's an SEC Item 402(v) construct — unvested equity revalued to year-end fair value — not cash anyone actually received that year. 5. Treat a missing year as missing. A foreign private issuer or a filer with no PvP table yet says so explicitly rather than leaving a number unaccounted for.
When to use it: Alongside the Management Quality Scorecard when compensation alignment specifically is the question, or any time a headline pay number needs checking against what the company actually filed.
Common mistakes beginners make: - Treating Compensation Actually Paid as take-home cash — it isn't. - Comparing one company's company-selected measure value directly to another's, as if the metric were standardized across filers. - Averaging multiple PEOs' figures together during a CEO transition year instead of reading each person's row separately.
Investor perspective: The SEC built Pay Versus Performance disclosure specifically so pay could be checked against results, not against a narrative — reading the actual table is usually more informative than any summary written about it.
Connects to: Pairs with the Management Quality Scorecard for a fuller read on whether leadership incentives are actually aligned with shareholders.
In short: Who owns 5% or more of the company, as filed in the latest proxy's beneficial-ownership table, plus any recent Schedule 13D or 13G activity against the issuer — and whether that activity reads as passive or potentially activist.
Questions it answers: - Which holders own 5%+ of the company, and how many shares or what percent of class, as printed in the filing? - Has anyone filed a new Schedule 13D or 13G against this issuer in roughly the last two years? - Did a 13D filer state a "Purpose of Transaction" in Item 4, and what does it actually say? - Is a large holder's stake more likely passive — an index fund or index-tracking manager — or a sign of intended influence? - What does this framework not cover, like broader institutional-manager positioning?
How to use it, step by step: 1. Read the ownership table as filed. Holder name, shares, and percent of class — quoted, not estimated from other sources. 2. Check for recent 13D/13G filings. The form choice itself matters — a 13G filer is certifying passive intent by the form it chose. 3. Read any Item 4 excerpt literally. Only summarize what a "Purpose of Transaction" section actually states — don't infer intent beyond it. 4. Note what this doesn't cover. Full institutional-manager (Form 13F) positioning is a separate, cross-manager data set this framework doesn't source. 5. Treat "no filings found" as a real answer. A clean 24-month window with no 13D or 13G is informative on its own, not a gap in the data.
When to use it: When a large or unusual ownership stake is in the news, before assuming activist involvement, or as a standard check alongside the Management Quality Scorecard.
Common mistakes beginners make: - Assuming any large stake signals an activist campaign — most large holders are index funds or other passive managers. - Treating a 13G filing as evidence of intended control, when the form itself certifies the opposite. - Confusing this ownership table with full institutional (13F) ownership data, which this framework doesn't cover.
Investor perspective: Activist investors typically signal intent by filing a 13D with a detailed Item 4 — reading that filing directly, rather than a headline about it, is the only way to know what's actually being proposed.
Connects to: Complements the Management Quality Scorecard and Insider Activity Analyzer for a fuller picture of who actually influences the company's direction.
In short: When a company's debt actually comes due — year by year — and what its own credit agreements say about financial covenants, pulled from the filing's maturity schedule and debt footnote, not estimated.
Questions it answers: - What does the filing show for principal due in each of the next five years, and thereafter? - What specific instruments make up that debt — bonds, term loans, convertible notes — and their coupons and stated maturities? - What does the near-term concentration (Year 1 + Year 2) actually add up to, using only the disclosed rows? - What does the company's own credit agreement say about financial covenants, and is it in compliance? - Has a later 8-K disclosed a new borrowing or a credit-agreement amendment since this filing?
How to use it, step by step: 1. Read the maturity wall as filed. Year 1 through Year 5 and thereafter, in the units actually tagged — never blend a face-value row with a carrying-value row. 2. Check the instrument list. Coupon, stated maturity, and amount for each named bond or facility — a note is only called a convertible if the filing itself calls it that. 3. Do the near-term math from the filing's own rows. Year 1 + Year 2 as a percent of the total — arithmetic on disclosed numbers, not a new estimate. 4. Read the covenant language literally. A bare "we were in compliance" sentence with no ratio named stays exactly that — don't back into a headroom number that isn't in the filing. 5. Check for a subsequent 8-K. A new obligation or an amended credit agreement filed after the period-end can change the picture before the next 10-Q is out.
When to use it: Before sizing a position in a company carrying meaningful debt, ahead of a refinancing-sensitive maturity wall, or any time a "debt cliff" headline needs checking against the actual filing.
Common mistakes beginners make: - Treating an undrawn revolving credit facility as if it were maturing debt that needs repayment — it's available capacity, not a scheduled obligation. - Calling a bond due five years out a "near-term" risk; near-term means Year 1 and Year 2 only. - Assuming a general "in compliance" statement implies a specific headroom number that isn't actually stated in the filing.
Investor perspective: A debt maturity schedule tells you exactly when refinancing risk arrives — reading the filing's own ladder is a better use of time than any market commentary about a company's "debt wall."
Connects to: Pairs directly with Liquidity, Leverage & Commitments — that framework covers cash and committed capacity today, this one covers when the debt itself comes due.
In short: Many stock moves happen around specific events. Knowing what's coming helps you avoid surprises and decide whether to hold through an event or adjust your position beforehand.
Questions it answers: - What important events are scheduled for this company in the coming weeks or months? - Which events have the highest potential to move the stock? - How likely is each catalyst to be positive or negative? - Do I want to hold through these events or reduce risk beforehand? - Are there clusters of catalysts that could create higher volatility?
How to use it, step by step: 1. List known upcoming events — earnings dates, product announcements, FDA decisions, conferences, and other relevant items. 2. Rank by potential impact. Which events could move the stock the most? 3. Assess the likely direction based on current information — positive, negative, or uncertain. 4. Decide your approach. Full exposure through high-uncertainty events, or reduce size ahead of time? 5. Update the calendar regularly as new catalysts appear or dates change.
When to use it: As part of ongoing monitoring and especially before earnings or major company events.
Common mistakes beginners make: - Ignoring upcoming catalysts entirely. - Assuming every catalyst will be positive. - Holding large positions through high-uncertainty events without a plan.
Investor perspective: Professional investors often map catalysts carefully so they are not surprised by volatility. Timing and preparation matter even when the long-term thesis remains intact.
Connects to: Supports the Long-Term Investment Thesis by helping you manage shorter-term event risk and timing.
In short: Checks whether a company has the cash, debt levels, and unused committed capacity to cover what it owes today, using only the numbers printed in the filing — no annualizing one good quarter into a permanent cushion. The year-by-year maturity calendar and covenant terms are a separate framework (08).
Questions it answers: - What does the filing actually show for cash, marketable securities, and total debt? - How much of that debt is current versus non-current? - Does the 10-Q or 8-K disclose leases, purchase commitments, or guarantees? - How much undrawn capacity sits in a revolving credit facility, if stated? - What's missing that would be needed for a fuller liquidity read?
How to use it, step by step: 1. Check the liquidity figures. Cash, marketable securities, current and non-current debt — as printed, not adjusted. 2. Look for commitments. Leases, purchase obligations, guarantees — only if the 10-Q, 10-K, or 8-K actually states them. 3. Check undrawn capacity. Revolver availability if disclosed — this is what's actually free to draw on, not a debt figure itself. 4. Note what's not disclosed. A gap here is a gap in this filing, not evidence the company has no liquidity plan. 5. Resist the shortcut. Don't turn one quarter's cash balance into a year of runway, and don't build a coverage ratio from numbers that don't actually pair up.
When to use it: Before sizing a position in a company carrying real debt, ahead of a refinancing-sensitive name, or any time a "cash crunch" headline needs checking against the actual balance sheet.
Common mistakes beginners make: - Annualizing a single quarter's operating cash flow into a full year of liquidity. - Inventing a current ratio or coverage ratio from figures that weren't actually reported together. - Looking here for the debt maturity calendar or covenant terms — that's Debt Maturity Wall & Stated Covenants, not this framework.
Investor perspective: Liquidity problems are rarely a surprise to anyone reading the filing closely — they show up first in the footnotes, not the headline.
Connects to: Pairs directly with Debt Maturity Wall & Stated Covenants for the timing side of the same balance sheet, and with the Earnings Quality Analyzer for a fuller picture.
In short: A company can look strong in isolation. Comparing its moat directly to competitors reveals whether its advantages are truly superior or just average for the industry.
Questions it answers: - How does this company's competitive advantage compare to its peers? - Which competitor has the widest or most durable moat? - Are the sources of advantage similar or different across the group? - Is this company's moat widening, stable, or narrowing relative to rivals? - Does the relative moat strength support a premium or discount valuation?
How to use it, step by step: 1. Select the most relevant competitors — the true rivals for customers and market share. 2. Compare sources of advantage — brand, cost, switching costs, network effects, or something else. 3. Assess relative durability. Whose advantages look hardest for others to copy or erode? 4. Look at trends. Is any company gaining or losing ground in its competitive position? 5. Connect to valuation. Does the relative moat strength justify how the stocks are priced against each other?
When to use it: Alongside the Long-Term Investment Thesis and whenever you're choosing between similar companies in the same industry.
Common mistakes beginners make: - Comparing a company only to itself instead of to real competitors. - Assuming a larger company automatically has a wider moat. - Treating temporary advantages as permanent ones.
Investor perspective: Warren Buffett has long focused on the durability of competitive advantage. Comparing moats across competitors makes that assessment more rigorous.
Connects to: Strengthens both the Long-Term Investment Thesis and any relative valuation work.
In short: Management decisions compound over time. Strong operators can create significant value; weak or misaligned leadership can destroy it even in a decent business. This framework grades the people running the company.
Questions it answers: - How skillfully has management allocated capital in the past? - Do executives communicate clearly and candidly? - Are incentives aligned with long-term shareholder value? - Have past major decisions created or destroyed value? - How would I rate this team overall?
How to use it, step by step: 1. Review capital allocation history — what they've done with free cash flow (reinvest, acquire, repurchase, or pay dividends). 2. Evaluate communication quality. Do they explain results and strategy in plain language, or rely on jargon and spin? 3. Check alignment. Do insiders own meaningful stock, and are compensation structures reasonable? 4. Score the key dimensions — capital allocation, candor, and alignment on a simple scale. 5. Reach an overall judgment. Does the quality of management increase or decrease your confidence in the long-term thesis?
When to use it: On every company, especially those where management has significant influence over outcomes.
Common mistakes beginners make: - Judging management mainly by charisma or media presence. - Ignoring past capital allocation mistakes. - Overlooking incentive structures.
Investor perspective: Warren Buffett has repeatedly said that even a great manager cannot fix a fundamentally poor business, but strong management in a good business is a powerful combination.
Connects to: Directly supports the Long-Term Investment Thesis and interacts with Insider Activity analysis.
In short: Some businesses are highly exposed to the economic cycle or specific macro variables. Understanding that sensitivity helps you anticipate how the stock might behave in different environments.
Questions it answers: - How much does this company's performance depend on the overall economy? - Is the business sensitive to interest rates, inflation, or currency moves? - Would a recession likely hurt this company a little or a lot? - Are there macro factors that could act as strong tailwinds or headwinds? - How does this sensitivity affect the risk of the investment?
How to use it, step by step: 1. Identify key macro drivers. Which broad economic factors have the biggest impact on this business? 2. Assess the degree of sensitivity. Is this company highly cyclical, moderately sensitive, or relatively defensive? 3. Consider different scenarios. How would the business likely perform in a strong economy versus a recession? 4. Connect to portfolio risk. Does this macro sensitivity increase or diversify the risks already in your portfolio? 5. Factor it into position sizing. Given the macro exposure, does the position size still feel appropriate?
When to use it: Especially for cyclical companies, financials, industrials, and any stock with clear economic sensitivity.
Common mistakes beginners make: - Ignoring macro exposure entirely. - Assuming every company is equally sensitive to the economy. - Failing to consider how macro risks interact with other holdings.
Investor perspective: Howard Marks and other experienced investors emphasize understanding the environment and how different businesses respond to it. Macro Sensitivity Analysis makes that understanding more explicit.
Connects to: Feeds into both Portfolio Risk & Fit and the overall Long-Term Investment Thesis.
In short: Not all revenue is equal. High-quality revenue tends to be more predictable and resilient. Lower-quality revenue can disappear quickly when conditions change. This framework breaks down revenue to assess how durable it really is.
Questions it answers: - How much of the revenue is recurring versus one-time? - Is revenue concentrated in a few large customers? - Does the company have pricing power? - What is driving revenue growth — volume, price, or mix? - How durable does the revenue base appear?
How to use it, step by step: 1. Break down revenue sources. Where does the money actually come from? 2. Assess recurring versus transactional revenue. How much repeats reliably each period? 3. Check customer concentration. Would losing one or two large customers significantly hurt results? 4. Evaluate pricing power and growth drivers. Can the company raise prices, and is growth coming from healthy sources? 5. Form a quality judgment. Overall, how high-quality and sustainable does this revenue stream look?
When to use it: Whenever revenue growth looks strong on the surface or when customer concentration might be a risk.
Common mistakes beginners make: - Focusing only on the growth rate and ignoring revenue quality. - Overlooking customer concentration risk. - Treating all revenue as equally durable.
Investor perspective: High-quality, recurring revenue streams are generally valued more highly by sophisticated investors because they are more predictable and resilient.
Connects to: Supports both the Long-Term Investment Thesis and any assessment of earnings sustainability.
How many research frameworks does AlphaLens use? AlphaLens runs stock research through 15 structured frameworks, starting with the Full Company Breakdown and ending with the Dilution, SBC & Share Count assessment.
What order should I use the AlphaLens frameworks in? Start with the Full Company Breakdown to understand the business, move through moat analysis, valuation, and earnings quality, then build your Long-Term Investment Thesis. Use the remaining frameworks — Executive Compensation & Pay-vs-Performance, 5%+ Beneficial Ownership & Control Intent, Debt Maturity Wall & Stated Covenants, Catalyst Calendar, Liquidity/Leverage/Commitments, Competitor Moat Comparison, Management Quality, Macro Sensitivity, Revenue Quality, and Dilution/SBC/Share Count — to stress-test and refine your thesis.
Which framework should a beginner start with? The Full Company Breakdown. It's the foundation every other framework builds on — understanding what a company does and how it makes money before looking at price or valuation.
Do I need to run all 15 frameworks on every stock? No. The core sequence — Company Breakdown, Moat Analysis, Valuation, Earnings Quality, and Long-Term Investment Thesis — covers most decisions. The other frameworks add depth for specific situations, like stocks with high short interest or major upcoming catalysts.
Can I run all 15 frameworks at once? Yes — the Run All feature applies all 15 frameworks to a single ticker in one pass, so you get the complete picture without running each one manually.
What's the difference between fundamental and trading-oriented frameworks? Fundamental frameworks (like Company Breakdown, Moat Analysis, and Valuation) evaluate the business itself. Filing-focused frameworks (like Liquidity, Leverage & Commitments, Catalyst Calendar, and Dilution, SBC & Share Count) check the numbers behind the story. Both matter — fundamentals tell you what to own, the filing detail tells you whether the story holds up.
Why does the guide separate the bull case and bear case? Because most investors naturally build a stronger case for why a stock will go up than for why it might go down. Writing both with equal effort, as the Bull vs Bear + Moat Analysis framework requires, produces a more balanced view.
What is a "moat" in stock analysis? A moat is a durable competitive advantage — something rivals find hard to copy, based on brand, cost structure, switching costs, network effects, or similar factors — that protects a company's profits over time.
Why does earnings quality matter if a company is already profitable? Because reported profits aren't always backed by real cash generation. The Earnings Quality Analyzer checks whether earnings are sustainable or inflated by aggressive accounting choices.
What is a margin of safety, and why does the Fair Value Stress Test use it? A margin of safety is the cushion between what a stock is worth and what you pay for it. The Fair Value Stress Test estimates value under optimistic, base, and pessimistic scenarios to show how much cushion — or risk — exists at today's price.
What is the difference between the Long-Term Investment Thesis and the other frameworks? The Long-Term Investment Thesis is the final synthesis — it pulls together findings from all the other frameworks into a clear, written statement of why you do or don't want to own the stock, including what would prove you wrong.
How does Portfolio Risk & Fit help with position sizing? It checks how a new stock fits into your existing portfolio — concentration, correlation, and overall balance — so that even a strong thesis doesn't create an outsized risk at the portfolio level.
How do I pick the best stocks?
Start with the Full Company Breakdown to understand the business, run it through Bull vs Bear + Moat Analysis to test both sides of the case, check the valuation with the Fair Value Stress Test, and build a Long-Term Investment Thesis that includes what would prove you wrong. That sequence covers the same ground a professional analyst covers before buying.
How do I start investing in stocks as a beginner?
Learn to research one company thoroughly before putting money in. AlphaLens walks you through 15 structured frameworks — starting with understanding what a company does, then evaluating its competitive advantage, valuation, earnings quality, and risk. The frameworks turn "where do I even start" into a repeatable process.
How much should I invest when I start?
The Portfolio Risk & Fit framework helps with this — it analyzes position sizing based on your risk tolerance, existing holdings, and how concentrated you'd become. The answer is different for every investor, which is why a structured framework beats a generic rule of thumb.
Is now a good time to invest?
The Fair Value Stress Test answers this for any specific stock by estimating value under optimistic, base, and pessimistic scenarios. If the current price offers a margin of safety in the base case, the timing is more favorable. The Catalyst Calendar adds context by mapping upcoming events that could move the price.
What is the safest investment?
No stock is risk-free. The Risk Assessment frameworks help you understand which risks matter most and whether you're being compensated for taking them. The Portfolio Risk & Fit framework helps you size positions so that no single investment can do serious damage to your overall portfolio.
Should I invest in individual stocks or funds?
Individual stocks require real research — that's what these 15 frameworks provide. If you're willing to do the work, individual stocks give you control over exactly what you own. If not, index funds or ETFs are a reasonable alternative. The Portfolio Risk & Fit framework helps you understand whether your individual stock picks are actually giving you diversification or just concentrating risk.
How does the stock market work?
At the simplest level, stocks represent partial ownership of a business. The Full Company Breakdown framework starts here — understanding what the company does and how it makes money — before moving to price and valuation. The market sets a price based on supply and demand; the frameworks help you judge whether that price makes sense.
How do I diversify my investments?
The Portfolio Risk & Fit framework directly addresses this — it checks correlation between your holdings, measures concentration by sector and style, and recommends position sizing that keeps your portfolio balanced. Diversification isn't just owning many stocks; it's owning stocks that don't all move the same way at the same time.
What is the best long-term investment?
The Long-Term Investment Thesis framework helps you answer this for any specific stock. It builds a 3–5 year case based on business quality, competitive advantage, growth drivers, and management — then explicitly defines what would make that thesis wrong, so you can monitor it over time.
How do I know if a stock is overvalued or undervalued?
The Fair Value Stress Test estimates what a stock is worth under three scenarios (optimistic, base, pessimistic) and compares the result to today's price. If the price is below the base-case value, there may be a margin of safety. If it only works under optimistic assumptions, the stock may be overvalued.
Short-form versions of each framework, ready for pull-quotes, social captions, and page meta description tags.
| Framework | Quotable line |
|---|---|
| Full Company Breakdown | "Before you look at the stock price, understand the business." |
| Bull vs Bear + Moat | "Build the strongest case for the stock and the strongest case against it — with equal effort." |
| Fair Value Stress Test | "Don't estimate what a stock is worth once — estimate it three ways." |
| Earnings Quality Analyzer | "High reported profits don't always mean high-quality profits." |
| Long-Term Investment Thesis | "Without a clear thesis, it's easy to react emotionally to short-term price moves." |
| Executive Compensation & Pay-vs-Performance | "Reading the actual pay-vs-performance table is more informative than any summary written about it." |
| 5%+ Beneficial Ownership & Control Intent | "A 13G filer is certifying passive intent by the form itself — a 13D with a real Item 4 is a different signal entirely." |
| Debt Maturity Wall & Stated Covenants | "An undrawn revolver is available capacity, not a scheduled obligation." |
| Catalyst Calendar | "Many stock moves happen around specific events. Knowing what's coming helps you avoid surprises." |
| Liquidity, Leverage & Commitments | "Liquidity problems are rarely a surprise to anyone reading the filing closely — they show up first in the footnotes." |
| Competitor Moat Comparison | "A company can look strong in isolation. Comparing its moat to competitors reveals the truth." |
| Management Quality Scorecard | "Management decisions compound over time. Strong operators create value; weak ones destroy it." |
| Macro Sensitivity Analysis | "Some businesses are highly exposed to the economic cycle. Understanding that sensitivity matters." |
| Revenue Quality Decomposer | "Not all revenue is equal. High-quality revenue is predictable and resilient." |
| Dilution, SBC & Share Count | "Basic and diluted are not the same number — and neither is a memory." |