There was a time when MoatLens showed a number: a calculated value per share, neatly rounded, to two decimal places. It looked like a measurement. It was not one. We removed it — and we are now replacing it with something that works differently.
An app that outputs a company value acts as if it knew the future. It does not. What it knows is historical data and a model that somebody fed with assumptions. The assumptions decide the result — and those are exactly what the user never sees.
In our case, everything that typically goes wrong with such calculations did go wrong: a cap that quietly trimmed growth assumptions and still reported the result as a value. A place where revenue growth and earnings growth ran into the same formula although they are two different quantities. Secondary listings where price and balance sheet are kept in different currencies. Each error small on its own — together they produced numbers nobody could stand behind. So we switched the feature off instead of patching it.
The new feature is called “Your value range” and sits in the stock view, visibly marked as beta. You set four assumptions: how much freely available cash per share the company earns in a year, how strongly that should grow over ten years, what return you demand as a minimum on the money you commit, and what remains permanently after that. MoatLens puts starting values in front of you, taken from this company’s published figures, and notes on every line where the value comes from. You may change any of them.
The result is not a number but a range: a cautious, a middle and an optimistic end. That is not a blemish, it is the statement. Anyone who names a single figure claims a precision an estimate does not have.
Under every slider it says what that slider does — in your own numbers, not in the abstract. Beside it stands how heavily this assumption weighs compared with the others. For most companies the required return moves the result the most, well ahead of cash flow and growth.
Look closely at that. The required return is the only one of the four assumptions for which there is nothing to look up. Cash flow and growth have the company’s own history underneath them. Under discounting it says: there is nothing to look up for this — this value is pure expectation. Yours. And it is exactly the one that moves the result the most.
That is the uncomfortable truth about every company valuation, and with us it now stands visibly on the screen instead of in the small print: the number is for the most part your own expectation. Whoever knows that treats it as a reference point. Whoever does not, mistakes it for a finding.
Three things this can do that a supplied number cannot. It is traceable: every formula is open, every starting value names its source, and you can disagree with a result by changing the assumption you disagree with. It absorbs your knowledge: if you know an industry and know that last year was untypical, you can put that in. And it becomes valuable over time: only your assumptions are stored, never the result. A year from now you can read what you assumed back then and see what came true. That is the only feedback an estimate of value can ever get — and it makes you better next time.
Experienced investors do this back-of-the-envelope calculation anyway before they take a company seriously — usually on paper, in a few minutes, with rough assumptions. We are not building a replacement for that. We are building the paper.
What the feature does not do: it passes no judgement on the share price. No traffic light, no colour scale, no percentage distance to the price, no buy or sell recommendation. It puts your range and the last price side by side and describes where that price sits — nothing more. You draw the conclusion.
And where the data does not carry, it does not calculate. For a company in a loss phase the fields stay empty and say why. For a secondary listing with mixed currencies the feature does not appear at all. Better no number than one you cannot rely on — that was the reason to remove the old value, and it remains the standard.
The feature is new and carries a beta mark. It can change, and we keep learning from it. If something strikes you as unclear, wrong or awkward: write to us. That is exactly why it is out as a beta first.