Value
8.4/10data confidence 40%| Component | Sub-score |
|---|---|
| P/S | 8.0 |
| EV/EBITDA | 8.9 |
- ▸Attractively valued
BH · Why this verdict
Why Biglari Holdings (BH) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.0/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality registers at 3.6, below the engine's 4.0 floor, driven by the absence of a competitive moat and a 0.0 return-on-equity component, even though the Piotroski F-Score is a strong 9 out of 9. Quality breakdown | Quality score should climb above 4.0 as return-on-equity improves, or the moat characterization should strengthen over the next 12 months. | →Stable |
| CounterA perfect Piotroski F-Score is a well-documented predictor of forward outperformance, which could offset the moat and ROE weaknesses currently driving the composite quality score down. | ||
The stock screens as attractively valued, with a value score of 8.5 out of 10 supported by price-to-sales and EV/EBITDA components. Valuation breakdown | The value score should remain above 6.0 as the valuation discount persists or narrows over the next 12 months. | →Stable |
| CounterA cheap valuation combined with 0.0 return on equity could reflect a genuine structural earnings problem rather than an undervalued opportunity. | ||
The risk profile carries a high beta component (9.8 on the engine's scale) alongside meaningful leverage (debt/equity component 6.9), even as the composite risk score of 6.4 remains moderate. Beta | The beta component should decline as price volatility relative to the market moderates over the next 12 months. | →Stable |
| CounterZero measured volatility in the risk components suggests actual realized price swings have been limited, which could mean the elevated beta reading is not currently translating into outsized risk. | ||
The stock is overbought with an RSI of 80 while on-balance volume is falling in a distribution pattern, even though price remains above its 200-day moving average and momentum clears the engine's soft gate at 4.9. Momentum breakdown | RSI should normalize below 70 and on-balance volume should shift back toward accumulation over the next 12 months. | →Stable |
| CounterMomentum has already cleared the engine's hard 4.5 threshold, and price staying above the 200-day moving average during an overbought reading can simply reflect sustained strength rather than an imminent reversal. | ||
The engine attributes the stock's edge to its size, noting the $1.3 billion market cap sits below the threshold typically required for institutional participation. Edge rationale | As market capitalization grows toward or beyond the institutional-reach threshold, the constraint-based edge should compress over the next 12 months. | →Stable |
| CounterRemaining below institutional reach for an extended period could reflect structurally limited trading interest rather than an exploitable structural mispricing. | ||
Business quality registers at 3.6, below the engine's 4.0 floor, driven by the absence of a competitive moat and a 0.0 return-on-equity component, even though the Piotroski F-Score is a strong 9 out of 9.
→StableQuality breakdown
- Expectation
- Quality score should climb above 4.0 as return-on-equity improves, or the moat characterization should strengthen over the next 12 months.
CounterA perfect Piotroski F-Score is a well-documented predictor of forward outperformance, which could offset the moat and ROE weaknesses currently driving the composite quality score down.
The stock screens as attractively valued, with a value score of 8.5 out of 10 supported by price-to-sales and EV/EBITDA components.
→StableValuation breakdown
- Expectation
- The value score should remain above 6.0 as the valuation discount persists or narrows over the next 12 months.
CounterA cheap valuation combined with 0.0 return on equity could reflect a genuine structural earnings problem rather than an undervalued opportunity.
The risk profile carries a high beta component (9.8 on the engine's scale) alongside meaningful leverage (debt/equity component 6.9), even as the composite risk score of 6.4 remains moderate.
→StableBeta
- Expectation
- The beta component should decline as price volatility relative to the market moderates over the next 12 months.
CounterZero measured volatility in the risk components suggests actual realized price swings have been limited, which could mean the elevated beta reading is not currently translating into outsized risk.
The stock is overbought with an RSI of 80 while on-balance volume is falling in a distribution pattern, even though price remains above its 200-day moving average and momentum clears the engine's soft gate at 4.9.
→StableMomentum breakdown
- Expectation
- RSI should normalize below 70 and on-balance volume should shift back toward accumulation over the next 12 months.
CounterMomentum has already cleared the engine's hard 4.5 threshold, and price staying above the 200-day moving average during an overbought reading can simply reflect sustained strength rather than an imminent reversal.
The engine attributes the stock's edge to its size, noting the $1.3 billion market cap sits below the threshold typically required for institutional participation.
→StableEdge rationale
- Expectation
- As market capitalization grows toward or beyond the institutional-reach threshold, the constraint-based edge should compress over the next 12 months.
CounterRemaining below institutional reach for an extended period could reflect structurally limited trading interest rather than an exploitable structural mispricing.
TrendMatrix Research · core thesis
Engine thesis — one sentence
BH screens as cheap with a perfect Piotroski F-Score, but a lack of moat and zero return on equity drag its composite quality below the engine's floor, while an overbought technical setup and small-cap institutional constraint add further nuance.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 1.0 |
| Gross margin | 3.7 |
| Op margin | 1.2 |
| Net margin | 0.0 |
| Current ratio | 8.4 |
| Moat | 4.6 |
| Piotroski F | 10.0 |
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 9/9
Growth
3.1/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 3.1 |
Momentum
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 3.5 |
- ▸Overbought (RSI 70)
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%Peer rank
2.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.5 |
| quality rank | 0.2 |
| growth rank | 1.6 |
Technical
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.1 |
| support resistance | 2.7 |
| 52w position | 6.7 |
| gap | 5.0 |
Risk (lower is worse)
6.4/10data confidence 80%| Component | Sub-score |
|---|---|
| days to cover | 8.9 |
| volatility | 0.0 |
| beta | 9.8 |
| debt equity | 6.9 |
Catalyst
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (7)
- MOMENTUM:5.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:31d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- ASYMMETRY:UPSIDE_EXHAUSTED (upside=0.0%)
Reward-to-Risk
0.00
Upside
+0.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($1.3B) below institutional reach
SuitabilityAggressive — MCap $1.3B<$5B
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 8.4 could not lift the engine output above the verdict floor.
The strongest dimensions are Value at 8.4, Risk (lower is worse) at 6.4, and Catalyst at 6.4; the weakest are Peer rank at 2.7, Growth at 3.1, and Quality at 3.6. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 0.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Below Floor Despite Strong F Score
Trip ifQuality score rises above 4.0 from the current 3.6.
- P2Attractively Valued On Value Score
Trip ifValue score falls below 5.0 from the current 8.5, indicating the valuation discount has closed.
- P3Overbought Momentum With Distribution
Trip ifRSI falls below 50 from the current 80, easing the overbought distribution risk.
- P4Small Cap Institutional Constraint
Trip ifMarket capitalization rises above $5 billion from the current $1.3 billion.
- P5Elevated Beta Risk
Trip ifBeta component falls below 5.0 from the current 9.8.