Sentensis: Financial Analysis Framework for Equity Valuation

Sentensis (likely a proprietary or niche term) refers to a fundamental equity analysis framework linking financial statements to intrinsic stock value via discounted cash flow (DCF) principles.

Core Analytical Pillars

• Revenue Growth Trajectory: Historical trends, driver analysis, TAM/SAM/SOM, competitive moat sustainability.
• Profitability & Margins: Gross/Operating/Net margin expansion, unit economics, scaling leverage.
• Free Cash Flow (FCF) Generation: CFO - CapEx; conversion rate, durability, reinvestment needs.
• Capital Structure & Solvency: Debt/EBITDA, interest coverage, maturity profile, covenant headroom.
• Return on Invested Capital (ROIC): vs. WACC – value creation metric.
• Shareholder Yield: Dividends + buybacks + debt paydown / market cap.

Valuation Methodology

1. Historical normalization: Adjust for non-recurring items, accounting changes.
2. Forecasting: 5-10 year explicit FCF projections (revenue growth → margin → reinvestment).
3. Terminal value: Perpetuity growth or exit multiple.
4. Discounting: WACC reflecting business/financial risk.
5. Sensitivity analysis: Key drivers (growth, margin, WACC).
6. Reverse DCF: What assumptions justify current price?

Risk Assessment

• Disruption vulnerability (tech, regulation, consumer shift).
• Customer/supplier concentration.
• Accounting quality (accruals, revenue recognition, off-balance sheet).
• Management alignment (insider ownership, compensation structure).

Sentensis appears to be a structured fundamental analysis approach. Not a standard academic term – may be proprietary methodology.