The quantitative and qualitative factors when analysing a company

There’s not one metric that makes a company investable. Here are some of the quantitative and qualitative factors I consider when analysing a company

Quantitative

Consistently high return on capital Consistently high FCF growth rate Expanding profit margins (operating efficiency)
Prudent and sustainable approach to SBC, buybacks and dividends
Capital and asset light
Affordable debt

Qualitative

Recurring revenues
Affordable product that customers are highly dependent on (ideally mission critical) and unlikely to be cut during a downturn
Sales not highly cyclical Product not overly reliant on raw materials and therefore profitability not tied to commodity cycles Barriers to entry and barriers to scale

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