Us Value InvestingSAFE

Day1Global Finance Skills Share: US Stock, Macro Market, Crypto

The instruction file, verbatim from the audited commit — this is the text the model reads, and the surface the audit's instruction layer examines. Quoted here so you can judge it without cloning anything.

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name: us-value-investing
description: US stock value investing analysis framework. Systematically evaluates listed companies through 4 core dimensions (ROE sustainability, debt safety, free cash flow quality, economic moat assessment), outputting investment ratings and analytical reasoning. This skill should be used when users mention topics such as whether a US stock is worth holding long-term, fundamental analysis of a company, ROE analysis, debt ratio assessment, free cash flow, economic moat, Buffett-style stock picking, value investing screening, how to read a company's financial reports, whether a stock's valuation is reasonable, etc. Even if users simply ask something general like "What do you think of stock XX?" or "Help me analyze XX's fundamentals," this skill should be triggered to provide a structured value investing analysis framework.
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# US Stock Value Investing Analysis Framework

This skill helps you systematically analyze whether a US-listed company is worth holding long-term using Buffett-style value investing methods. Through quantitative assessment across 4 core dimensions, it provides a clear investment rating.

## Use Cases

Use this skill when users ask the following types of questions:
- Whether a particular US stock is worth buying/holding long-term
- Help me analyze a company's fundamentals
- How to interpret a company's financial report data
- Whether a company has an economic moat
- Help me screen stocks using value investing methods

## Analysis Framework

### 4 Core Assessment Dimensions

For each dimension, use web_search to look up the target company's latest financial report data, then evaluate according to the criteria below.

#### Dimension 1: ROE Sustainability (Return on Equity)

**What it is**: ROE (Return on Equity) = Net Income / Shareholders' Equity. Simply put: for every $100 shareholders invest in the company, how much profit can it generate in a year. An ROE of 15% means every $100 of shareholder capital creates $15 in profit. This is the single financial metric Buffett values most — he believes a truly excellent company should be able to consistently and efficiently deploy capital.

**Key point**: Don't look at just one year's ROE; check whether it has maintained a high level **consistently for 3+ years**. A single year of high ROE could be due to one-time factors (selling a building, winning a lawsuit), and only sustained high ROE demonstrates genuine competitive strength.

**Search keywords**: `[Company name] ROE history` or `[Company name/ticker] return on equity 3 year`

**Scoring criteria**:
- 3+ consecutive years ROE > 20% → ⭐⭐⭐ Excellent (3/3 points)
- 3+ consecutive years ROE > 15% → ⭐⭐ Good (2 points)
- ROE 10-15% or inconsistent → ⭐ Average (1 point)
- ROE < 10% or highly volatile → 0 points

**Common pitfalls**:
- High leverage can artificially inflate ROE. If a company has high ROE but also high debt, take it with a grain of salt.
- Share buybacks reduce shareholders' equity, thereby "inflating" ROE. This needs to be evaluated alongside actual earnings growth.
- Cyclical industries (e.g., oil, semiconductors) will see ROE fluctuate significantly with industry cycles; a full cycle should be examined.

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#### Dimension 2: Debt Safety (Debt-to-Equity / Debt Ratio)

**What it is**: Measures how much a company borrows to fund its operations. Two commonly used metrics:
- **Debt-to-Asset Ratio** = Total Liabilities / Total Assets. 50% means half of the company's assets are funded by debt.
- **Debt-to-Equity Ratio** = Total Liabilities / Shareholders' Equity. 1.0 means borrowings equal shareholders' investment.

Low debt means the company doesn't rely on borrowing to operate and can better withstand downturns. Highly leveraged companies are vulnerable when interest rates rise or revenue declines.

**Search keywords**: `[Company name] debt to equity ratio` or `[Company name/ticker] balance sheet debt`

**Scoring criteria**:
- Debt-to-asset ratio < 30% → ⭐⭐⭐ Excellent (3/3 points): Virtually no debt pressure
- Debt-to-asset ratio 30-50% → ⭐⭐ Good (2 points): Manageable debt
- Debt-to-asset ratio 50-70% → ⭐ Average (1 point): Debt repayment capacity needs monitoring
- Debt-to-asset ratio > 70% → 0 points: High leverage risk

**Industry-specific notes**:
- **Banks and financial companies**: Inherently high debt (since deposits count as liabilities), so the same standards don't apply. For banks, Tier 1 Capital Ratio is more appropriate; typically > 10% is considered healthy.
- **Utilities and REITs**: Generally have higher debt ratios; 50-60% is normal within the industry.
- **Tech companies**: Many quality tech companies have very low debt ratios or even net cash positions, which is a positive indicator.

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#### Dimension 3: Free Cash Flow Quality (Free Cash Flow Quality)

**What it is**: Free Cash Flow (FCF) = Operating Cash Flow - Capital Expenditures. Simply put: the **cash truly left over** after the company completes all its business activities, pays all operating expenses, and purchases necessary equipment and facilities.

Why compare it to net income? Because net income can be "window-dressed" through accounting methods (e.g., adjusting depreciation schedules, timing of revenue recognition), but cash flow is hard to fake — the bank account balance is what it is. When FCF exceeds 80% of net income, it indicates the company's profits are "real money," not just numbers on paper.

**Search keywords**: `[Company name] free cash flow` or `[Company name/ticker] cash flow statement`

**Scoring criteria**:
- FCF > 100% of net income → ⭐⭐⭐ Excellent (3/3 points): Cash flow exceeds profit, extremely high quality
- FCF > 80% of net income → ⭐⭐ Good (2 points): High-quality earnings
- FCF = 50-80% of net income → ⭐ Average (1 point): Notable gap, reasons need investigation
- FCF < 50% of net income or negative → 0 points: Earnings quality is questionable

**Common scenarios**:
- **High-growth companies**: Companies in rapid expansion p

SAFEgrade B · trust 89/100 Nothing in the source contradicts what it says it does. Grade A is reserved for packages that have also passed the behavioural sandbox.

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