Educational publication. Not investment advice. Neither John Gillespie nor InsightfulAgents.AI LLC is a registered investment adviser.
Warren Buffett doesn't use a stock screener. He reads financial statements. Income statement, balance sheet, cash flow, in that order. He's looking for specific numbers that tell him whether a business has a durable competitive advantage.
Peter Lynch doesn't treat every stock the same. A fast-growing tech company and a slow-growing utility require completely different analysis. Judging them by the same criteria is how retail investors end up confused.
Most retail investors do neither. They check a price target, read an analyst rating, and hope for the best.
I spent the last three months building OCCAM'S FORENSIC JURY™, a system that combines both approaches and tracks every call it makes against real market data.
The Problem with One-Size-Fits-All Analysis
Here's what most stock tools give you: a DCF model, an intrinsic value, and a verdict. Buy, sell, or hold.
But that single model carries all the assumptions of whoever built it. And it treats every stock the same way. A high-growth SaaS company gets the same analysis framework as a REIT paying 8% dividends.
That's like grading a sprinter and a marathon runner on the same scorecard. Technically possible. Practically useless.
What Buffett Actually Looks For
When Buffett reads a 10-K, he's running a mental checklist. Not complicated. Not secret. But remarkably few investors actually do it:
- Gross margin above 40%. Confirms pricing power and a moat.
- Net income margin above 20%. Earnings are real, not accounting tricks.
- SG&A below 30%. Overhead is controlled.
- Interest expense below 15% of revenue. Can service debt even in a downturn.
- Capital expenditure below 25%. Free cash flow isn't eaten by reinvestment.
- More cash than debt. Self-funding, not dependent on capital markets.
- Debt-to-equity below 0.80. Survives recessions.
Seven metrics. Pass or fail. No ambiguity.
What Lynch Actually Does
Lynch classifies every stock into one of six categories before analyzing it. Each category has different expectations, different risk, and different kill criteria:
- Fast Growers. Revenue growing 15%+. These are compounding machines. You're buying the growth trajectory. Kill signal: gross margin below 40% or capex above 25% means the moat is eroding.
- Stalwarts. Growing 5 to 15%. Core portfolio holdings. You buy them, hold for a moderate gain, and exit. Kill signal: Buffett metrics fail AND P/E above historical range.
- Slow Growers. Below 5% growth. You own these for income. Kill signal: D/E above 0.80 or net margin below 20% means the dividend is at risk.
- Cyclicals. Tied to economic cycles. You only buy near confirmed troughs. Kill signal: D/E above 0.80 at the trough means bankruptcy risk, not opportunity.
- Turnarounds. Negative earnings. Binary outcomes. Kill signal: cash less than debt with no financing path means avoid entirely.
- Asset Plays. Trading below net asset value. You're buying the discount. Kill signal: D/E above 0.80 means the assets aren't really yours.
The Matrix: Where Buffett Meets Lynch
The Forensic Jury does three things automatically for every stock:
- Classifies it into a Lynch category based on growth rate, sector, and financial profile.
- Runs all seven Buffett metrics and scores it (e.g., 6 of 7 pass).
- Generates a kill signal if the stock fails the critical metric for its category.
Then it asks one question: "What does a Buffett-style screen produce on this name?"
For a Fast Grower passing all seven metrics, the Forensic Jury produces a "compounding-machine, wide-moat" classification consistent with Buffett's stated framework.
For a Slow Grower failing the debt test, the methodology produces an "income-sustainability-at-risk" flag. The dividend coverage math signals strain.
For a Turnaround with more debt than cash, the methodology produces an "avoid-entirely" flag. There's no financing path that makes the math work.
No ambiguity. No "it depends." A clear, defensible methodology grounded in the same principles behind one of the most studied investment approaches in history.
Tracking Every Verdict
I'm not asking anyone to trust a black box. Every methodology verdict the Forensic Jury produces is tracked against subsequent market behavior, updated daily, fully transparent.
Did entries flagged by the Forensic Jury as quality-screen-passing trade up? Did flagged entries trade down?
You can see the historical accuracy tracker right on the dashboard. Early results are encouraging, but the real value comes from the growing dataset. Every week adds more data points. Every data point makes the Forensic Jury more accountable.
This isn't a backtest run on historical data to find patterns that already happened. This is live methodology output measured against subsequent market behavior. Not a recommendation to act, just an accountability log of methodology performance.
The Part Most People Skip
Here's what I've learned building this: the kill signal is more valuable than the buy signal.
Most investors spend their energy finding stocks to buy. The real edge is knowing which stocks to avoid, and having a systematic reason why.
When the Forensic Jury flags a kill signal on a stock you're watching, it sends you an email. Not "this stock dropped 5%." Not "an analyst downgraded it." But: "This stock failed a critical Buffett financial metric for its Lynch category. The original thesis may no longer hold."
That's the kind of educational signal that helps you do your own research before things get worse. And it's the one most platforms don't give you.
Try It
Every valuation on Occam's Investing now includes:
- Lynch category classification (auto-detected)
- Buffett scorecard (7 metrics, pass/fail)
- Kill signal detection (category-specific)
- "What does a Buffett-style screen produce on this name?" summary line
- Personalized verdict based on your risk tolerance
- Historical accuracy tracking (updated daily)
Run any stock through the Forensic Jury for free. No account required:
insightfulagents.ai/free-valuation.html
Premium members get watchlist tracking, kill-signal email alerts, and portfolio scoring by Lynch category. Premium is $20/month; Premium+ is $75/month:
insightfulagents.ai/occams-investing.html
Follow the Cash. Not the Narrative. Because Profit is Opinion and Cash is Fact.