CluenexGlossary · Business quality
Business quality score
A 0 to 10 score of how good the business is, scored against its own industry.
Why it matters
Good businesses compound value for years; weak ones need a cheap price to be worth owning. Quality is the first half of every Cluenex verdict.
How to read it
It averages four checks: profitability, moat, financial health and growth. Banks and insurers skip the debt check, because borrowing is how they work.
Related
ProfitabilityHow much of each sales dollar the company keeps as profit.MoatA lasting advantage that keeps competitors from taking a company’s profits.Financial healthWhether the balance sheet can survive a bad year: debt, cash and the cash flow to pay debts.Revenue growthHow fast sales are rising compared with a year earlier.Price verdictOur one word read on price: below fair value, within the fair range, above it, or speculative.
In the Cluenex app, this explanation opens next to every business quality score figure, with the live reading for the stock you are looking at. Open it in Cluenex