The model is built on a simple truth: over the long run, stock prices follow the growth of free cash flow per share.

It is designed primarily for listed stocks, where hard numbers reveal the compounding engines — and judgment refines them into generational investments.

Hard values are the quantitative core of the model. They strip away narratives, hype, and market noise, reducing everything to what can be measured with discipline.

• Engine (FCF/share CAGR): The compounding power of the business. If free cash flow per share grows steadily, the engine is working.

• Price (P/FCF vs. growth): Even the best engine is a bad investment if bought at the wrong price. Valuation must align with growth.

• Moat (Durability): What prevents competitors from eroding returns? Strong moats ensure compounding persists over decades.

Together, the hard values create a filter. They automatically narrow the investable universe down to a handful of true compounders — businesses that can survive cycles, crises, and time.

Soft values are the qualitative layer that numbers alone can’t capture. They refine the shortlist, giving us conviction about which companies are merely good, and which are generational.

• Leadership: Capital allocation, discipline, and shareholder alignment.

• Innovation culture: Does the company reinvest intelligently to stay ahead?

• Secular tailwinds: Is the business aligned with long-term shifts like AI, electrification, or demographic change?

• Resilience: How well can it withstand shocks, regulation, or geopolitical shifts?

Soft values don’t replace discipline — they amplify it. They add the human, forward-looking perspective that separates good investing from blind number-crunching.