Glossary

Plain-language definitions for every metric and concept used on Valpik.

P/E (Price/Earnings): Price divided by yearly profit. Lower can mean cheaper — but check why it's low.
Forward P/E: Like P/E but using expected next-year profit.
P/B (Price/Book): Price versus the company's net asset value. Lower can mean cheaper.
PEG: P/E adjusted for growth. Around 1 or below is often considered reasonable.
P/S (Price/Sales): Price versus revenue. Useful when profits are volatile.
FCF Yield: Free cash flow divided by market value. Higher means more real cash for the price.
Dividend Yield: Yearly dividend as a percent of price.
Buyback Yield: Net share buybacks (repurchases minus issuance) divided by market cap. Together with dividends, it measures the cash actually returned to shareholders. Positive = returning capital; negative = dilution from new shares.
EV/EBITDA: Enterprise value versus core earnings. Lower is generally cheaper.
EV/Sales: Enterprise value versus revenue.
Net Debt / EBITDA: How many years of core earnings it would take to repay debt. Lower is safer.
P/CF (Price/Cash Flow): Price versus operating cash flow.
ROE (Return on Equity): Profit earned on shareholders' money. Higher is better quality.
ROA (Return on Assets): Profit earned on total assets.
Rule of 40: Revenue growth % + profit margin %. ≥ 40 is healthy for software.
Earnings Growth: How fast profit is growing year over year.
Value trap: A stock that looks cheap but is cheap for a bad reason (declining business, losses). The #1 beginner mistake — cheap can keep falling.
Consensus: How many of our value strategies rank this stock as top-tier within the same market. These strategies share some inputs (e.g. free cash flow), so this is not fully independent confirmation. It means a high relative rank, NOT that the stock is cheap in absolute terms. 3 or more is stronger; 1 is a weak single-strategy signal.
Trap veto: A hard filter that flags likely value traps (shrinking earnings, negative cash flow, or losses).
Downside rigidity: How well a stock has historically resisted falling — a rough floor-strength gauge.
Upside potential: A rough gauge of room to re-rate higher based on valuation and trend.
Signal lights: Color bands showing whether a number is cheap (green), average (gray), or expensive (red) versus peers. (The Score cell uses accent intensity, not this red/green rule.)
Rank movers: How a stock's rank changed since yesterday. ▲ up, ▼ down.
Ichimoku cloud: A Japanese trend tool. Price above the 'cloud' is supportive; below is weak.

Strategies

Shareholder Yield: Favors companies returning the most cash to shareholders, via dividend yield and net buyback yield (the actual cash returned). Popularized by Meb Faber — a well-evidenced flagship strategy.
Quality-Value Gate: Combines cheapness with quality (profitability, low debt) and vetoes obvious value traps. A balanced all-rounder.
Quality Value: Ranks on free-cash-flow yield, return on equity, and low net debt.
Magic Formula (simplified): A simplified take on Joel Greenblatt's Magic Formula: high return on assets (ROA) bought at a low EV/EBITDA.
Rule of 40: For software/high-growth names balancing growth and profitability.
Acquirer's Multiple: Tobias Carlisle's 'Acquirer's Multiple' — a single-metric value baseline from an acquirer's view (originally EV/EBIT; we approximate with EV/EBITDA).
GARP: Growth companies that aren't overpriced for their growth (Peter Lynch style).