@v587d/capital-generation 2.7.11 → 2.7.12

package/selected-skills/peter-lynch-skill/skills/peter-lynch-skill/SKILL.md

@@ -47,96 +47,20 @@ Determine the workflow from the user's message:
 
 If neither a company nor ticker can be inferred from the request, ask one concise clarification question.
 
-The source tiers below (aggregator profile pages, SEC / regulator filings, annual reports) are US and overseas-listing conventions. In an A-share session the same analysis must be asked for in A-share terms instead — disclosure platforms, no Form 4 / 13F, no wash-sale rules — and that is decided by the host's retrieval channel, not by this skill.
+The source tiers in `references/10-workflow.md` (aggregator profile pages, SEC / regulator filings, annual reports) are US and overseas-listing conventions. In an A-share session the same analysis must be asked for in A-share terms instead — disclosure platforms, no Form 4 / 13F, no wash-sale rules — and that is decided by the host's retrieval channel, not by this skill.
 
 Do **not** ask the user for an annual report PDF or API keys.
 
-## Workflow overview
+## Read the Parts
 
-Copy this checklist and track progress:
+Everything below the surface of this file lives in `references/`. Open a part with `read`,
+resolved against this skill's base directory; each part is sized to arrive complete in one
+`read`. If a receipt shows `[... tool result middle pruned ...]`, re-read it with `offset`
+before concluding anything is missing.
 
-```
-Task Progress:
-- [ ] Step 1: Route (quick or deep)
-- [ ] Step 2: Read workflow-specific web research guide
-- [ ] Step 3: Gather data and compile structured research brief
-- [ ] Step 4: Read workflow prompts
-- [ ] Step 5: Write report from the brief only
-- [ ] Step 6: Append disclaimer
-```
+- `references/10-workflow.md` — Workflow overview; Research brief; Failure handling
 
-### Step 1: Route
+Loading this file is not reading the skill: the steps, templates, and thresholds exist only
+in the parts above. Say which parts you opened, name the ones you did not, and never report a
+step or a template you have not read in this session.
 
-Select **Quick** or **Deep** using the routing table above.
-
-### Step 2: Read workflow-specific web research guide
-
-Read only the workflow-specific web guide:
-
-- **Quick:** [references/quick/web-research.md](references/quick/web-research.md)
-- **Deep:** [references/deep/web-research.md](references/deep/web-research.md)
-
-Read [references/filing-rules.md](references/filing-rules.md) only when regulator/XBRL data, ADRs, secondary listings, specialized financial companies, or accounting-basis issues matter. Do not read it for normal Quick Research unless the Quick web guide specifically triggers it.
-
-### Step 3: Gather data and compile research brief
-
-Asking the host's own retrieval path for the data (in a host that splits roles: delegate it with the brief, do not browse from here):
-
-1. Follow the **workflow-specific** source plan, retrieval brief, stopping rule, and research brief template in `references/quick/web-research.md` or `references/deep/web-research.md`.
-2. Respect the workflow-specific default budgets unless an override in that workflow guide is triggered — the budget is how many sources you ask the channel for, not how many you go and open yourself:
-   - **Quick:** practical default of 1-3 reputable aggregator sources, 2-3 retrieval queries, and 2-3 page fetches; expand only when another aggregator is needed to complete the existing Quick methodology.
-   - **Deep:** 5-7 sources, 6-8 retrieval queries, 7-10 page/document fetches, with the default source set kept as small as the report can support.
-3. For **Quick**: gather the minimum viable evidence needed for a responsible SKIP / WATCHLIST / DEEP RESEARCH decision, then stop.
-4. For **Deep**: follow the annual report discovery procedure in `references/deep/web-research.md` — ask for the latest full annual report on the company's investor relations site (HTML or PDF); regulator filings are the fallback.
-5. Do not ask for a separate retrieval per fiscal year for normal historical metrics. For Quick, use aggregator tables. For Deep, use the annual report, 10-K / 20-F, regulator filing, or regulator facts feed as the historical base.
-6. Do not print research narration, retrieval play-by-play, or the full research brief unless the user asks for it.
-7. Capture period, currency, units, date gathered, and source ID(s) for every important number and claim. Each source ID must resolve to a URL in the Source Ledger. Filing labels may be included, but they do not replace a ledger URL.
-8. Do **not** invent financial data.
-
-### Step 4: Read workflow prompts
-
-**Quick path** — read both before writing:
-
-- [references/quick/system-prompt.md](references/quick/system-prompt.md)
-- [references/quick/methodology.md](references/quick/methodology.md)
-
-**Deep path** — read both before writing:
-
-- [references/deep/system-prompt.md](references/deep/system-prompt.md)
-- [references/deep/methodology.md](references/deep/methodology.md)
-
-### Step 5: Write report
-
-Use the research brief as the only factual context for the report. Do not include the full research brief in the final report unless the user asks for it.
-
-Every final report must cite sources with links:
-
-- Any company description, financial number, valuation metric, market data point, management claim, industry claim, competitor claim, ownership claim, or news/update claim needs a source.
-- Use source lines directly below the relevant bullet or paragraph: `source: [Source name](https://...)`.
-- Multiple sources may be separated with semicolons.
-- Do not cite a source that is not in the research brief Source Ledger.
-- Expand any internal source IDs from the brief into full linked `source:` lines in the final report.
-- Source lines do not count toward Quick or Deep word limits.
-
-Internally prefix the analysis context with:
-
-```
-Data gathered: YYYY-MM-DD
-
-## Research brief
-
-{full research brief markdown}
-```
-
-### Step 6: Append disclaimer
-
-Read [references/disclaimer.md](references/disclaimer.md) only when the report body is ready. After the report body, add a horizontal rule and append the full contents of the disclaimer.
-
-## Failure handling
-
-- If the host's retrieval path returns nothing for a field you need: name the missing fields and stop the analysis that depends on them — do not fabricate data.
-- If a ticker cannot be resolved: inform the user clearly.
-- If the annual report cannot be found after all fallbacks in `references/deep/web-research.md`: note the gap in the research brief and proceed using other verified sources — do **not** ask the user for a PDF.
-- If a specific metric is unverified: say you do not know; do not estimate or invent numbers.
-- If retrieved claims lack source ID(s) that resolve to Source Ledger URL(s): do not include them in the report.
-- If live market data cannot be verified from the current source: for Quick, ask the channel for another reputable aggregator; for Deep, use the workflow's market-data fallback rules. Do not use stale or unsourced values.

package/selected-skills/peter-lynch-skill/skills/peter-lynch-skill/references/10-workflow.md

@@ -0,0 +1,94 @@
+# Workflow and Research Brief
+
+Part 1 of 1 for `peter-lynch-skill` — the six steps, the research brief template, and failure handling
+See `SKILL.md` for what to read and when; this part is procedure, not routing.
+
+## Workflow overview
+
+Copy this checklist and track progress:
+
+```
+Task Progress:
+- [ ] Step 1: Route (quick or deep)
+- [ ] Step 2: Read workflow-specific web research guide
+- [ ] Step 3: Gather data and compile structured research brief
+- [ ] Step 4: Read workflow prompts
+- [ ] Step 5: Write report from the brief only
+- [ ] Step 6: Append disclaimer
+```
+
+### Step 1: Route
+
+Select **Quick** or **Deep** using the routing table above.
+
+### Step 2: Read workflow-specific web research guide
+
+Read only the workflow-specific web guide:
+
+- **Quick:** [references/quick/web-research.md](references/quick/web-research.md)
+- **Deep:** [references/deep/web-research.md](references/deep/web-research.md)
+
+Read [references/filing-rules.md](references/filing-rules.md) only when regulator/XBRL data, ADRs, secondary listings, specialized financial companies, or accounting-basis issues matter. Do not read it for normal Quick Research unless the Quick web guide specifically triggers it.
+
+### Step 3: Gather data and compile research brief
+
+Asking the host's own retrieval path for the data (in a host that splits roles: delegate it with the brief, do not browse from here):
+
+1. Follow the **workflow-specific** source plan, retrieval brief, stopping rule, and research brief template in `references/quick/web-research.md` or `references/deep/web-research.md`.
+2. Respect the workflow-specific default budgets unless an override in that workflow guide is triggered — the budget is how many sources you ask the channel for, not how many you go and open yourself:
+   - **Quick:** practical default of 1-3 reputable aggregator sources, 2-3 retrieval queries, and 2-3 page fetches; expand only when another aggregator is needed to complete the existing Quick methodology.
+   - **Deep:** 5-7 sources, 6-8 retrieval queries, 7-10 page/document fetches, with the default source set kept as small as the report can support.
+3. For **Quick**: gather the minimum viable evidence needed for a responsible SKIP / WATCHLIST / DEEP RESEARCH decision, then stop.
+4. For **Deep**: follow the annual report discovery procedure in `references/deep/web-research.md` — ask for the latest full annual report on the company's investor relations site (HTML or PDF); regulator filings are the fallback.
+5. Do not ask for a separate retrieval per fiscal year for normal historical metrics. For Quick, use aggregator tables. For Deep, use the annual report, 10-K / 20-F, regulator filing, or regulator facts feed as the historical base.
+6. Do not print research narration, retrieval play-by-play, or the full research brief unless the user asks for it.
+7. Capture period, currency, units, date gathered, and source ID(s) for every important number and claim. Each source ID must resolve to a URL in the Source Ledger. Filing labels may be included, but they do not replace a ledger URL.
+8. Do **not** invent financial data.
+
+### Step 4: Read workflow prompts
+
+**Quick path** — read both before writing:
+
+- [references/quick/system-prompt.md](references/quick/system-prompt.md)
+- [references/quick/methodology.md](references/quick/methodology.md)
+
+**Deep path** — read both before writing:
+
+- [references/deep/system-prompt.md](references/deep/system-prompt.md)
+- [references/deep/methodology.md](references/deep/methodology.md)
+
+### Step 5: Write report
+
+Use the research brief as the only factual context for the report. Do not include the full research brief in the final report unless the user asks for it.
+
+Every final report must cite sources with links:
+
+- Any company description, financial number, valuation metric, market data point, management claim, industry claim, competitor claim, ownership claim, or news/update claim needs a source.
+- Use source lines directly below the relevant bullet or paragraph: `source: [Source name](https://...)`.
+- Multiple sources may be separated with semicolons.
+- Do not cite a source that is not in the research brief Source Ledger.
+- Expand any internal source IDs from the brief into full linked `source:` lines in the final report.
+- Source lines do not count toward Quick or Deep word limits.
+
+Internally prefix the analysis context with:
+
+```
+Data gathered: YYYY-MM-DD
+
+## Research brief
+
+{full research brief markdown}
+```
+
+### Step 6: Append disclaimer
+
+Read [references/disclaimer.md](references/disclaimer.md) only when the report body is ready. After the report body, add a horizontal rule and append the full contents of the disclaimer.
+
+## Failure handling
+
+- If the host's retrieval path returns nothing for a field you need: name the missing fields and stop the analysis that depends on them — do not fabricate data.
+- If a ticker cannot be resolved: inform the user clearly.
+- If the annual report cannot be found after all fallbacks in `references/deep/web-research.md`: note the gap in the research brief and proceed using other verified sources — do **not** ask the user for a PDF.
+- If a specific metric is unverified: say you do not know; do not estimate or invent numbers.
+- If retrieved claims lack source ID(s) that resolve to Source Ledger URL(s): do not include them in the report.
+- If live market data cannot be verified from the current source: for Quick, ask the channel for another reputable aggregator; for Deep, use the workflow's market-data fallback rules. Do not use stale or unsourced values.

package/selected-skills/peter-lynch-skill/skills/peter-lynch-skill/references/deep/methodology-1.md

@@ -0,0 +1,220 @@
+## 1) Business Model and Understandability
+
+**Output format: maximum 400 words**
+
+### 1.1 Business Model in Plain Language
+
+Answer:
+- What does the company actually sell?
+- Who are the main customers?
+- How does the company make money?
+- In which geographies does the company operate?
+
+Write this so a 12-year-old could understand it.
+
+### 1.2 Business Structure Analysis
+
+- First, analyze earnings (profit) structure by segment and product if data is available.
+
+- If segment-level profit data is available:
+    - show % contribution to total operating income or net income
+
+- If not available:
+    - fall back to revenue structure (with %)
+
+- Highlight:
+    - the most profitable segment and product
+    - whether profits are concentrated or diversified
+
+### 1.3 Hype Check
+
+- Is the business thesis based on real business performance or just hype?
+- If the exciting product/division is **<10% of total revenue**, question whether it can meaningfully drive EPS.
+
+**Warning:**  
+If the thesis relies on a revolutionary technology, miracle drug, or “next big thing” narrative without meaningful current revenue contribution, apply extreme skepticism.
+
+### 1.4 Earnings Drivers: Controllable vs External
+
+Identify **1–4 key current earnings drivers** and the drivers expected to shape future earnings.
+
+For each driver:
+- briefly describe it
+- label it as:
+  - **Mostly controllable** — mainly influenced by management decisions
+  - **Mostly external** — mainly driven by market, macro, commodity, regulation, or industry conditions
+
+Guideline: stability and continuity of earnings drivers are preferred because they improve predictability.
+
+### 1.5 Business Understandability Check
+
+Classify business complexity:
+
+- **Easy** — simple business model; revenue drivers and risks are clear
+- **Moderate** — some industry-specific metrics or dynamics require extra work
+- **Hard** — complexity, regulation, accounting, or technical factors materially affect valuation
+
+If classified as **Hard**, explicitly state what must be understood before investing.
+
+### 1.6 Investment Story & Invalidation Conditions
+
+- What is the one-sentence thesis for this business?
+- What are **2–3 conditions** that would kill the thesis? Use a numeric list.
+- How will you track whether the story is unfolding?
+
+## 2) Diagnostic Profile (No Single Category)
+
+**Output format: maximum 250 words**
+
+Report the following traits independently.  
+For each trait, give:
+- **State**
+- **Conviction**: Low / Medium / High
+- **Evidence**: 1 short sentence
+
+Use this compact bullet format:
+
+- Cyclicality: [state] | Conviction: [Low/Medium/High] | Evidence: ...
+- Turnaround status: [state] | Conviction: [Low/Medium/High] | Evidence: ...
+- Growth profile: [state] | Conviction: [Low/Medium/High] | Evidence: ...
+- Business maturity: [state] | Conviction: [Low/Medium/High] | Evidence: ...
+- Asset angle: [state] | Conviction: [Low/Medium/High] | Evidence: ...
+- Dominant analytical lenses: [list up to 2 traits that should dominate the rest of the analysis]
+
+### 2.1 Cyclicality
+
+States:
+- **High**
+- **Moderate**
+- **Low**
+
+Rules:
+- **High** if:
+  - at least **2 full EPS cycles** in the last 10 years (**peak → trough → peak**),
+  - peaks had positive EPS,
+  - swings were **≥30%**
+- **Moderate** if:
+  - 1 clear cycle, or
+  - repeated earnings swings of roughly **15–30%**, or
+  - the industry is clearly cyclical but the financial history is too short for a High rating
+- **Low** otherwise
+
+### 2.2 Turnaround Status
+
+States:
+- **None**
+- **Active**
+- **Recovering**
+
+Rules:
+- **Active** if any of the following are true:
+  - EPS declined **2+ consecutive years**
+  - revenue contracted **>5%** and margins compressed
+  - EPS is **≥30% below prior peak**
+  - and the deterioration is **not mainly normal cyclicality**
+- **Recovering** if the business recently met Active criteria but revenue, margins, or EPS have now stabilized or started improving
+- **None** otherwise
+
+### 2.3 Growth Profile
+
+States:
+- **Fast**
+- **Stalwart-like**
+- **Slow**
+- **Moderate/Other**
+- **Declining**
+
+Rules:
+- **Fast** if:
+  - **2Y EPS CAGR ≥20%**
+  - revenue growth confirms
+  - growth is **not mainly a cyclical rebound**
+  - growth is **not merely recovery from a distressed base**
+- **Stalwart-like** if:
+  - **2Y EPS CAGR = 8–12%**
+  - margins are stable
+  - no 2-year EPS decline
+  - no revenue contraction >5%
+  - and cyclicality is **not High**
+- **Slow** if:
+  - **2Y EPS CAGR = 2–5%**
+  - and the business appears **large/mature**
+  - and there is no obvious distress
+- **Moderate/Other** if results fall between bands or are mixed
+- **Declining** if EPS CAGR is below 2% or negative
+
+**Guardrail:** If EPS growth is mostly from buybacks, cost cutting, or recovery off a depressed base, say growth quality is weaker.
+
+### 2.4 Business Maturity
+
+States:
+- **Early**
+- **Scaling**
+- **Mature**
+
+Rules:
+- **Early** — still proving the model; concentrated geography/product; evidence base limited
+- **Scaling** — model proven and expanding into more markets/products; meaningful whitespace remains
+- **Mature** — broad penetration, lower whitespace, and capital allocation/dividends/buybacks matter more
+
+### 2.5 Asset Angle
+
+States:
+- **None**
+- **Possible**
+- **Strong**
+
+Rules:
+- **Strong** if verifiable after-tax asset value exceeds market cap by **≥30%**
+- **Possible** if hidden assets appear meaningful but valuation or catalyst is incomplete
+- **None** otherwise
+
+### 2.6 Dominant Analytical Lenses
+
+Choose **up to 2** traits that should dominate the rest of the analysis.  
+Examples:
+- High cyclicality
+- Active turnaround
+- Recovering turnaround
+- Fast growth
+- Strong asset angle
+- Mature slow-growth economics
+
+## 3) Long-Term Track Record
+
+**Output format: maximum 220 words**
+
+### 3.1 Revenue & EPS Trend
+
+Summarize:
+- revenue direction and rough CAGR band
+- earnings per share (EPS) consistency and volatility
+- major drops or spikes
+
+### 3.2 Earnings Predictability
+
+Rate one:
+- **Rock steady** — net income grows or holds in 4–5 of 5 years; no single year drops more than ~20%; operating cash flow confirms
+- **Moderate fluctuation** — net income swings roughly ±20–50%, or net income is noisy but operating cash flow is steadier
+- **Highly volatile** — net income swings more than 50% in multiple years, or both net income and operating cash flow are erratic
+
+If volatility is mainly due to cyclicality, say so explicitly rather than treating it as a generic red flag.
+
+### 3.3 Profitability
+
+Primary metric:
+
+- **Pretax profit margin** (rising, stable, falling?)
+
+Secondary:
+
+- Return on Equity (ROE) (direction and stability)
+
+Avoid reliance on ROIC unless clearly labeled as supplemental.
+
+### 3.4 Share Dilution
+
+State whether share count is:
+- materially shrinking
+- stable
+- heavily diluting

package/selected-skills/peter-lynch-skill/skills/peter-lynch-skill/references/deep/methodology-2.md

@@ -0,0 +1,146 @@
+# references/deep/methodology.md · Part 2 of 4
+
+Part 2/4 of `references/deep/methodology.md` — split so each part arrives complete in one `read`; see `references/deep/methodology-1.md` for the whole guide.
+
+## 4) Balance Sheet & Financial Safety
+
+**Output format: maximum 220 words**
+
+### 4.1 Leverage
+
+Discuss:
+- debt-to-equity trend
+- net debt trend
+- interest coverage = EBIT ÷ interest expense
+
+Standard benchmark:
+- below **3x** interest coverage = monitor closely
+- below **1.5x** = red flag
+
+
+Use **interest‑bearing debt only**: short‑term borrowings + long‑term debt + current portion of long‑term debt. 
+Do NOT use total liabilities. It will distort brokers, banks, insurers, and high working‑capital businesses.
+
+**warning thresholds:**
+- If **Growth profile = Fast** → **D/E > 33%** = red flag
+- If **Turnaround status = Active or Recovering** OR **Cyclicality = High** → **D/E > 50%** = red flag
+- All others → **D/E > 80%** = red flag
+
+### 4.2 Liquidity
+
+- Current ratio = current assets ÷ current liabilities.
+  Below 1.0 means the company cannot cover near-term obligations
+  from current assets alone — flag it.
+
+- Receivables check: if receivables grow significantly faster than
+  revenue, it may signal customers are slow to pay or that sales are
+  being pulled forward artificially.
+- Inventory vs revenue growth: if inventory grows faster than revenue → warning. For cyclical businesses this is a high-priority red flag. For turnarounds and fast growers, note that additional context is needed before drawing conclusions.
+
+### 4.3 Net Cash Cushion
+
+Net cash = cash and short-term investments − total interest-bearing debt.
+Total interest-bearing debt = long-term debt + current portion of
+long-term debt + short-term borrowings.
+
+Net cash per share = net cash ÷ diluted shares outstanding.
+
+- If **positive**: state the net cash per share and note that it lowers
+  the effective purchase price (stock price − net cash per share = true
+  cost of the business) and reduces bankruptcy risk.
+- If **negative**: flag the shortfall, state the amount, and note its
+  size relative to annual operating cash flow.
+
+### 4.4 Off-Balance-Sheet Risks
+
+Check:
+- **Pension liabilities**: note whether funded or underfunded.
+- **Operating leases**: note total commitment if material relative to
+  operating income.
+- **Goodwill**: if goodwill exceeds 25% of total assets, investigate
+  acquisition history — check whether past acquisitions generated
+  earnings growth or resulted in write-downs, and whether new
+  acquisitions are still being made.
+
+### 4.5 Turnaround Survival
+
+**Only if Turnaround status = Active or Recovering**
+
+Can cash + FCF likely cover **12–24 months**?  
+Prefer turnarounds with low or no debt.
+
+---
+
+## 5) Cash Flow & Earnings Quality
+
+**Output format: maximum 220 words**
+
+### 5.1 Do Reported Profits Match Cash Generation?
+
+- Compare net income to operating cash flow over at least 3 years.
+  A persistent gap where operating cash flow is less than half of net
+  income needs a specific explanation (depreciation, stock-based
+  compensation, working capital changes). Unexplained gaps are a warning.
+- Is free cash flow positive? If negative, identify whether it is driven
+  by high capital expenditure (investment phase — requires context) or
+  by weak operating cash flow (structural concern — red flag).
+
+Red flags:
+- Rising net income with flat or declining operating cash flow over
+  multiple years
+- Repeated "one-time" charges or adjustments that recur every year
+- Free cash flow persistently negative while net income is reported positive
+
+### 5.2 Capex Logic
+
+- High capex acceptable if tied to real expansion
+- Low capex despite bold growth story → suspicious
+
+### 5.3 Dividend Policy
+
+- Dividend policy (stable, growing, cut?)
+
+Interpretation by profile:
+- **Slow + Mature** → dividends and payout safety matter
+- **Fast or Scaling/Early** → reinvestment is usually preferable
+- **Stalwart-like / mature non-cyclical** → balanced mix is acceptable
+
+## 6) Growth Drivers & “Room to Grow”
+
+**Output format: maximum 220 words**
+
+### 6.1 Specific Growth Drivers
+
+List 1–4 main growth drivers.
+
+For each:
+
+- Evidence in numbers
+- Revenue contribution % (if available)
+- Scalability
+
+### 6.2 Duplication Model Test
+
+Is growth driven by:
+- replication of a proven model (preferred), or
+- constant reinvention (riskier)?
+
+### 6.3 Expansion Possibility
+
+Discuss:
+- whitespace remaining
+- geographic penetration
+- store/location/product saturation
+- whether the company is still early in market penetration or already broadly present
+
+If most markets already penetrated → growth may slow.
+
+### 6.4 Unit Economics
+
+Discuss:
+
+- Gross margin trend
+- Pretax margin by segment
+- Basic unit profitability logic
+
+Judge: Strong / Acceptable / Weak

package/selected-skills/peter-lynch-skill/skills/peter-lynch-skill/references/deep/methodology-3.md

@@ -0,0 +1,114 @@
+# references/deep/methodology.md · Part 3 of 4
+
+Part 3/4 of `references/deep/methodology.md` — split so each part arrives complete in one `read`; see `references/deep/methodology-1.md` for the whole guide.
+
+## 7) Competitive Position
+
+**Output format: maximum 250 words**
+
+Avoid generic "moat" language. State specifically whether the company is a cost leader, niche specialist, brand-driven, or undifferentiated competitor, and what evidence supports that label. If competitor margin data is available, compare directly; if not, note the absence.
+
+### 7.1 Industry Structure
+
+- Fragmented or consolidated? Name the 2–3 largest competitors.
+- Are margins in the industry rising, stable, or under pressure?
+- Structural tailwinds or headwinds?
+
+Use competitors and industry context already disclosed in the annual report,
+latest results, or existing research brief first. Do not ask for a separate
+external source only to make this subsection look complete.
+
+Ask the host's retrieval channel for competitor or industry material only when
+it can change the investment conclusion, such as when competitive pressure,
+market-share loss, peer margins, industry cyclicality, regulation, or structural
+industry change is central to the thesis.
+
+If peer margin data is not already available from the existing source ledger
+and is not thesis-critical, write `not available` rather than asking for another
+source only to complete this subsection.
+
+### 7.2 Diworsification Check
+
+Have recent acquisitions or strategy moved outside core competency?
+
+If yes → assess risk.
+
+### 7.3 Institutional Ownership
+
+- % held by institutions
+- Lower ownership may allow re-rating potential.
+
+Use only if available from the existing source ledger or quickly available from
+the proxy / ownership source already gathered. If not available, write
+`unknown`; do not add a new source unless ownership could materially change the
+investment conclusion.
+
+### 7.4 Management Ownership
+
+Distinct from insider *buying* signals, this is
+a one-time baseline criterion:
+
+- Does management (CEO, CFO, key executives) hold a meaningful
+  equity stake relative to their compensation?
+- Is the ownership stake a result of open-market purchases or
+  purely from option grants?
+
+Open-market purchases by management → strong alignment signal.
+Ownership purely from grants/options → weaker alignment.
+Negligible personal ownership → flag; management benefits mainly
+from salary, not stock performance.
+
+Use the proxy / ownership source if it is already in the ledger or if governance
+is thesis-critical. If management ownership is not disclosed or not gathered,
+write `unknown` and lower conviction where appropriate; do not ask for extra
+ownership sources merely to complete this subsection.
+
+## 8) Valuation
+
+**Output format: maximum 220 words**
+
+Use the valuation lens that matches the Diagnostic Profile.
+
+### 8.1 Valuation Lens by Profile
+
+Apply the most relevant lens:
+- **High cyclicality** → use normalized or mid-cycle earnings; low P/E at peak can be dangerous, high P/E at trough can be opportunity
+- **Active/Recovering turnaround** → P/E may be misleading; focus more on survival, dilution, and normalized earning power
+- **Fast growth** → PEG/PEGY, runway, and growth durability matter most
+- **Strong asset angle** → asset value, catalyst, and downside floor may matter more than P/E
+- **Stalwart-like / Slow / Mature** → P/E, dividend yield, and earnings line are more informative
+
+### 8.2 Core Metrics
+
+State:
+- trailing P/E
+- growth expectation band
+- dividend yield
+
+Compare to:
+- own history
+- the most relevant diagnostic lens
+
+If earnings are negative or distorted, say P/E is not meaningful.
+
+### 8.3 PEG & PEGY
+
+PEG = P/E ÷ growth rate  
+PEGY = P/E ÷ (growth rate + dividend yield)
+
+Use percentage terms (e.g. 15, not 0.15)
+
+Interpretation:
+- **<1** → cheap
+- **≈1** → fair
+- **1–1.5** → acceptable
+- **>1.5–2** → expensive unless exceptional
+
+### 8.4 Net Cash Adjustment
+
+Adjusted price = stock price − net cash per share  
+Recalculate effective P/E if appropriate.
+
+### 8.5 Earnings Line Check
+
+Does price sit far above or below the earnings trend?