Quality-Adjusted Value: Blending Value and Business Quality
Quality-adjusted value explained: why investors combine valuation with quality metrics, and how this approach improves intrinsic value estimates.
What is quality-adjusted value?
Quality-adjusted value blends valuation with business quality. Instead of treating all earnings equally, investors reward strong profitability, stability, and balance sheet strength.
Why investors do this
- Low-quality businesses can be cheap for a reason
- Strong businesses can compound value over time
- Quality metrics help avoid value traps
Screen for value + quality together
Use the screener to filter by profitability and safety alongside valuation.
FAQs
What's a value trap?▼
A stock that looks cheap on simple metrics, but the business is deteriorating, so intrinsic value keeps falling.
Does quality-adjusted value replace DCF?▼
No. It's a lens that can modify assumptions or weights. Many investors use multiple methods and compare agreement.
Related
Intrinsic Investor is for education and research only. Not financial advice.