What’s actually worth focusing on when researching stocks?

Story

A while ago, I asked about the biggest headaches in stock research (link). After going through 81 responses, this is what stood out (link).

I boiled them down to four big challenges:

  • Too much info, not enough clarity – Reports, metrics, news, opinions… what actually matters and deserves sharp attention?
  • Valuation struggles – P/E, DCF, comparables—so many methods, but what actually works and how to turn them into real conclusions?
  • Understanding moats – Figuring out if a company has a real edge and whether it’ll last.
  • Buy/Sell decisions – Even after all the research, pulling the trigger still feels uncertain—a leap of faith.

I personally share these struggles and have been working on making my own process simpler and repeatable.

My Process

Goal: Buy great businesses at a fair price. Process is:

This is how I break it down:

  1. eval business quality (5-year revenue growth% >10%, ops margin>25%, return on capital employed>10%, and debt/equity ratio<80%) ;
    • (I use these to infer moat strength—high % means the company makes what the market wants, has pricing power, and dominates its space.)
  2. eval price: p/e vs industry (<1x), vs its own history(<1.5x) and price vs dcf (<1x)

Example: GOOG

  1. business quality (5-year)
  • Revenue Growth 13.9% (Goal: ≥ 10%)
  • Operating Margin 27.8% (Goal: ≥ 20%)
  • Return on Capital 25% (Goal: ≥ 15%)
  • Debt / Equity 10.1% (Goal: ≤ 100.0%)
  1. price fairness (5-year)
  • P/E vs Industry 0.64x (Goal: ≤ 1.5x)
  • P/E vs Historical 0.99x (Goal: ≤ 1.5x)
  • Price vs Fair Value 0.77x (Goal: ≤ 0.8x)
  1. Decision BUY (7 out of 7 criteria met)

Questions:

What do you think of this process?

How do you deal with these challenges?

What actually helped or didn't help you make better decisions?