Frequently Asked Questions

Reverse-DCF works backward from the current stock price to determine the market's implied growth expectations. Instead of asking 'What is this stock worth?', it asks 'What growth rate does the market already expect?' Modelvix calculates the implied growth rate (g_implied) and compares it with the actual historical growth rate (g_actual). The gap between these reveals whether the market expects higher or lower growth than the company's historical performance. Results are categorized into four zones: Strong Buy, Buy, Fair, or Expensive, based on the relationship between implied and actual growth.

A single DCF projection gives one answer, but the future is uncertain. Monte Carlo simulation runs 10,000 different scenarios, each with slightly different assumptions for growth rates, margins, and returns. This produces a probability distribution of possible outcomes rather than a single point estimate. Modelvix displays the expected return, probability of positive returns, downside risk at the 5th percentile, and the full range of P10, P25, P50, P75 percentiles. You can also view a histogram of the simulation distribution and qualitative flags that highlight structural characteristics of the company.

Intrinsic value is the true worth of a stock based on its fundamental financial data, independent of market price. Modelvix calculates intrinsic value using DCF (Discounted Cash Flow) analysis with Monte Carlo simulation. The result includes P50 intrinsic value (the median expected value) and P25 intrinsic value (a more conservative estimate). A company is considered undervalued when its current market price is below the P50 intrinsic value, and overvalued when it is above.

The model uses several key assumptions: WACC (Weighted Average Cost of Capital) defaults to 10%, adjusted per company risk. The terminal growth rate is set at 2% (long-term GDP-like growth). The projection period is 10 years. Revenue growth is based on the 5-year historical average. Operating margin uses trailing 12-month data. Capital intensity is calculated from invested capital relative to revenue. These assumptions can be adjusted interactively using the sliders in the analysis report to see how changes affect the valuation.

Data is updated daily. Modelvix fetches the latest financial statements and market data from Finnhub and Financial Modeling Prep each day. All calculations are performed server-side, and results are cached for 24 hours to ensure fast performance while maintaining data freshness.

A company may not be available for several reasons. The ticker might not be supported by our data providers, the company may have insufficient financial data (e.g., no recent financial statements), or it may be a non-US-listed company. When you search for a company, Modelvix first checks for matching tickers and company names. If zero matches are found, you will see a 'No companies found matching your search' message. If multiple matches appear, you can select the correct one from the company picker.

No. Modelvix is an analytical tool only — it is not investment advice. The data, analysis, and reports provided are for informational and educational purposes only. They should not be considered a recommendation to buy, sell, or hold any security. Always conduct your own research and consult with a qualified financial advisor before making investment decisions. Past performance and historical data do not guarantee future results.

Yes. Modelvix allows you to override the default assumptions and see how changes affect the valuation in real time. You can adjust the revenue growth rate, WACC (discount rate), operating margin, and capital intensity. These adjustments are made through the interactive sliders in the simulation report or by sending custom parameters via the Reverse-DCF assumptions endpoint. The analysis is then recalculated server-side with your custom assumptions and the updated results are displayed instantly.

The Investment Score (mc_score) is a composite score from 0 to 1 that summarizes the overall quality of the investment opportunity. It is calculated as a weighted combination of four factors: probability of positive return (30% weight), downside protection measured by P10 (25% weight), median return potential measured by P50 (25% weight), and risk-adjusted return measured by Sharpe ratio (20% weight). Based on the score, companies are assigned a grade of A (strong), B (moderate), or C (weak).

Modelvix runs 10,000 Monte Carlo simulations for each analysis. Each simulation randomly varies key assumptions — growth rates, operating margins, and returns — within statistically determined ranges. Running 10,000 scenarios provides a robust probability distribution of possible outcomes, allowing you to assess not just the expected return but also the range of possibilities and the likelihood of different outcomes. The results are visualized through a histogram showing the frequency distribution of simulated returns.