Ultimate Compounder Criterias Edition 1, Analyzed By Deepseek
Ultimate Compounder Criterias Edition 1, Analyzed By Deepseek
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Deepseek would explain the philosophy behind the Ultimate Compounder Criterias - Edition 1 Check
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Dear Deepseek,
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Ask :
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(1)
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My definition :
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Ultimate Capital (Asset) Light Business Model is defined if the Ultimate Productive Capital (Asset) Light Business Model Hierarchy Criteria is fulfilled.
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Ultimate Productive Capital (Asset) Light Business Model Hierarchy Criteria :
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Total Current Assets > Total Equity > Total Liabilities > Total Current Liabilities > Total Non-Current Assets > Total Non-Current Liabilities
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(2)
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My definition :
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Ultimate Hybrid of Profitabilities And Margins is defined if the Ultimate Hybrid of Profitabilities And Margins Hierarchy Criteria is fulfilled.
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Ultimate Hybrid of Profitabilities And Margins Hierarchy Criteria :
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GPA > ROIIC > CROIC > ROIC > ROICE > ROA > GPM > NPM > 2.5 × CICC
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(3)
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My definition :
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Ultimate Growth is defined if the Ultimate Growth Condition is fulfilled :
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Ultimate Growth Condition:
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Net Profit Growth is equal to or more than Invested Capital Growth, in such a way that (1 + Net Profit Growth Ratio)÷(1 + Invested Capital Growth Ratio) ≥ 1
Or
Net Profit Growth ≥ Invested Capital Growth
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(4)
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My definition :
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Ultimate Compounder is defined if all the components in the Ultimate Compounder Criterias are fulfilled at the same time concurrently :
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Ultimate Compounder Criterias
=
Ultimate Productive Capital (Asset) Light Business Model Hierarchy Criteria
+
Ultimate Hybrid of Profitabilities And Margins Hierarchy Criteria
+
Ultimate Growth Condition
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:: Note 1 ::
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Clean Invested Capital Cost Factor
= { [ 1 + 10Y Government Bond Ratio ] × [ 1 + D/E × (1 + Commercial Loan Prime Ratio + Spread Ratio) ] ÷ [ 1 + D/E ] }
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CICC
= 100 × (Clean Invested Capital Cost Factor - 1)
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(1 + ROIC Growth Ratio)
=
(1 + Net Profit Growth Ratio)÷(1 + Invested Capital Growth Ratio) ≥ 1
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GPA (%) = 100 × Gross Profit ÷ Total Assets
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ROIIC (%) = Incremented Net Income ÷ Incremented (Total Equity + Total Interest Bearing Debts + Total Lease Liabilities)
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CROIC (%) = 100 × Free Cash Flow ÷ (Total Equity + Total Interest Bearing Debts + Total Lease Liabilities)
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ROIC (%) = 100 × Net Income ÷ (Total Equity + Total Interest Bearing Debts + Total Lease Liabilities)
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ROICE (%) = 100 × Net Income ÷ (Total Equity + Total Non-Current Liabilities + Short Term Interest Bearing Debts)
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ROA (%) = 100 × Net Income ÷ Total Assets
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GPM = Gross Profit Margin
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NPM = Net Profit Margin
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:: Note 2 ::
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Total Current Liabilities include Lower Short Term Lease Liabilities, Lower Short Term Interest Bearing Debts, Higher Short Term Contract Liabilities, and Other Current Liabilities.
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Total Non-Current Liabilities include Higher Long Term Lease Liabilities, Higher Long Term Interest Bearing Debts, Lower Long Term Contract Liabilities, and Other Non-Current Liabilities.
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Short Term Lease Liabilities are Lower than Long Term Lease Liabilities.
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Short Term Contract Liabilities are more than Long Term Contract Liabilities.
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Short Term Interest Bearing Debts are Lower than Long Term Interest Bearing Debts.
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Total Current Assets include Short Term Contract Assets, Zero Right of Use Assets, Very Low Inventory and Other Short Term Assets.
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Total Non-Current Assets include Zero Long Term Contract Assets, Right of Use Assets, Intangible Assets, Low PPE, Zero Inventory and Other Long Term Assets.
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All items are available (present) in the balance sheet.
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If the conditions are fully fulfilled, I deem that it is the result of the capital (assets) light business model and the capital productivity (in terms of revenue) being very high and operation efficient being very high.
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Please analyze and comment.
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Please don't mention any stock names.
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Case Study :
PDD
(Financial.2025.Sep.Q3.TTM)
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(1)
GPA TTM = 38.632827484 %
ROIIC = -5.2923494045 %
CROIC = Not Available as FCF Q3 Is Not Available
ROIC TTM = 25.4354775147 %
ROICE TTM = 25.4314588448 %
ROA TTM = 16.663851178 %
GPM TTM = 56.64858878 %
NPM = 24.43475444 %
CICC = 4.99398204 %
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Gni TTM = -5.54001811 %
Gic TTM = +1.3925129068 %
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(2)
CRITERIA CHECK
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(2.1)
Total Current Assets > Total Equity > Total Liabilities > Total Current Liabilities > Total Non-Current Assets > Total Non-Current Liabilities
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Ultimate Productive Capital (Assets) Light Business Model Hierarchy Criteria
= 5> over 5> requirement
= 100% Fulfilled
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(2.2)
GPA > ROIIC < ROIC > ROICE > ROA < GPM > NPM > 2.5 × CICC
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Ultimate Hybrid of Profitabilities and Margins Hierarchy Criteria
= 5> over 7> requirement
= 71.4285714286% Fulfilled
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(2.3)
Gni TTM < Gic TTM
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Ultimate Growth Criteria
= 0> over 1≥ requirement
= 0% Fulfilled
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(2.4)
Ultimate Compounder Scores
= (1 + 0.714285714286 + 0)÷3
= 0.5714285714
= 57.14285714 %
