Equity Research Framework

What This Skill Does

This is the scaffolding for building a research view on any public company. Given a company + some initial interest, it walks through the steps to land on a thesis that's defensible, evidence-based, and clearly opinionated. Without a framework, research becomes "I read the 10-K and I like them" — which doesn't convince anyone and won't hold up when the stock moves against you.

The framework has five pillars: Business (what they actually do and how they make money), Industry (structural dynamics, competition, secular tailwinds/headwinds), Financials (profitability, growth, capital efficiency), Valuation (what you're being asked to pay relative to what you're getting), and Risks (what breaks the thesis). A finished thesis covers all five.

The Framework

1. Business

• What do they sell, and to whom? Be specific. "They sell software" is useless; "They sell cloud-native HR systems to mid-market enterprises (500–5,000 employees) in North America, primarily" is useful.
• Revenue model: Subscription? Transaction? Services? Hardware + service? Mix? For each line, what's the unit (per-seat, per-transaction, per-consumption)?
• Customer concentration: Top 10 customers as % of revenue. >20% = concentration risk. <10% = diversified.
• Geography: US / international mix. FX exposure.
• Go-to-market: Direct sales, channel, self-serve, mix. Changes in GTM often predict margin trajectories.
• Product strategy: Single-product company, platform strategy, suite strategy. Platform plays have higher NRR ceiling; single-product exposed.
• Moat: What keeps competitors out? (Network effects, switching costs, proprietary data, regulatory, brand, scale economics). Rate moat 1–5.