The QSA Scoring System is designed to rate companies according to QSA growth and value criteria in order to identify those with the best investment profile. The scoring system allows comparisons between companies by scoring each company s fundamentals, as analyzed by QSA , in a rigorous and consistent manner.
Investors can also specify the universe from which to screen stocks.
The GARP Score is our main screening tool in the QSA Scoring System as it incorporates the other individual scores. The GARP Score is an average of two underlying scores, the Growth Score, which measures the earnings growth profile of company, and the IBV Score which measures the value with respect to the company s Intrinsic Business Value. A score of zero is assigned if the IBV one-year out equals the current share price. The IBV Score also incorporates the growth in the IBV over the past 12 months, indicating whether management has been successful in increasing the value of the firm. This helps avoid buying companies that, from a static perspective, seem to have large upside to its IBV, but the negative dynamic of a falling IBV tends to negate much of it, keeping the share price from rising.