Methodology & Data Sources

What MoatCheck is for

MoatCheck is a personal research tool built to make a first pass through a company less scattered. It collects financial and qualitative signals in one place, but it does not decide whether a stock is worth buying. The useful output is a starting point for questions, not a verdict.

Sources and refresh cycle

Every source has different strengths and delays. The table below explains what MoatCheck uses and where an important figure should be checked again.

The refresh pipeline runs on a schedule and only fetches a company again when new information is expected. Provider limits mean that a newly added ticker can wait for a later refresh. Each record should therefore be read with its source and date in mind.

SEC EDGAR

Financial statements, annual reports (10-K), quarterly reports (10-Q), and other mandatory filings are sourced from the U.S. Securities and Exchange Commission's EDGAR database. This is the official repository for public company filings in the United States.

Financial data providers

Alpha Vantage is the main financial-data provider. Finnhub can supply selected quarterly fields, but only when its reporting period and value pass consistency checks against the main source. This is intended to avoid silently combining figures from different periods.

News and updates

Company investor-relations feeds, press feeds and EDGAR updates supply material for the qualitative review. They make new material easier to find, but they do not replace reading the underlying document.

Moat Analysis Framework

MoatCheck provides structured frameworks for analyzing competitive advantages. These frameworks are based on widely-accepted investment principles, including concepts popularized by Warren Buffett and analyzed by researchers like Pat Dorsey.

Types of Moats Analyzed

• Intangible Assets: Patents, brands, regulatory licenses that competitors cannot easily replicate
• Switching Costs: Costs (monetary, time, or effort) that make customers reluctant to switch to competitors
• Network Effects: Products or services that become more valuable as more people use them
• Cost Advantages: Structural cost advantages from scale, location, or unique assets
• Efficient Scale: Markets where limited demand supports only one or a few competitors profitably

Quantitative Indicators

MoatCheck presents financial metrics that may indicate moat strength, including:

• Return on Invested Capital (ROIC): Consistently high ROIC may indicate pricing power or cost advantages
• Gross and Operating Margins: Stable or expanding margins may indicate competitive advantages
• Revenue Growth: Sustainable growth without margin compression may indicate moat durability
• Market Share Trends: Ability to maintain or grow market share over time

How the score should be read

MoatCheck combines a fundamentals score and a risk score into a composite score. The current weighting is 60% fundamentals and 40% risk. It is a transparent, practical choice made for this project, not a claim that those weights are universally correct. A high score means the inputs fit the model better than other companies in the current dataset. It does not establish intrinsic value, forecast a return, or remove the need to assess price, portfolio fit and uncertainty.

Some measures do not mean the same thing in every sector. For example, debt to EBITDA is excluded from the fundamentals score for financial-services companies rather than being treated as directly comparable to an industrial company. This is one reason to inspect the underlying breakdown instead of relying on a single number.

Limitations

While MoatCheck aims to provide useful tools for investment research, users should be aware of important limitations:

Data Accuracy

Data is sourced from third-party providers and official filings, but errors can occur in aggregation and presentation. Always verify important data points against primary sources (original SEC filings) before making decisions.

Historical Data

Price history is weekly, not daily. Historical backtests also apply a delay before fundamental information becomes available, so they do not use a quarterly result before it could reasonably have been known. Even with that safeguard, past performance does not guarantee future results.

Qualitative Factors

Quantitative data alone cannot capture all factors that affect a company's competitive position. Management quality, corporate culture, regulatory environment, and technological change require qualitative judgment that no automated tool can provide.

Coverage

MoatCheck focuses on U.S. public companies with SEC filings. International companies, private companies, and newly public companies may have limited or no coverage.

Important Disclaimers

The implementation is available in the public MoatCheck repository on GitHub. It documents the data pipeline and the assumptions in code, including the safeguards described here.