QXO, Inc.

Where It Passes

Where It Falls Short

• Valuation0% pass✓ 6✗ 22▾

  No clean pass — all 13 investors flag at least one valuation criterion

  Price / Book Value per Share0.9x

  ✓Dreman< 1.2x✓Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Book Ratio0.9x

  ✓Graham<= 1.5x

  P/E x P/B

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value-2.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=-2.1%, ROC=-5.7%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)32.5x

  ✗Dreman< 8x

  Valuation ReasonablenessOE Yield=-2.9%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldFCF Yield=1.4%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/B=0.9x

  ✓MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share46.4x

  ✗Ackman<= 25

  Price vs. Trailing Low114% of trailing low ($11.04)

  ✓Templeton<= 120% of trailing low (certified split-adjusted live window)

  Net income / market capitalization-3.91%; #3767/6340 (top 59.4%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+0.7921; #1944/6449 (top 30.1%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share10.95x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+789.8%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.7555; #2111/5247 (top 40.2%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization+1.07%; #2387/4519 (top 52.8%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date-26.96%; #4284/6202 (top 69.1%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Valuation models0% pass✗ 3▾

  QXO overvalued: all 3 models price fair value below $12.60 (median $9.64)

  Munger fair value$4.64

  ✗Munger-171.6% margin vs $12.60

  Akre fair value$9.64

  ✗Akre-30.7% margin vs $12.60

  Ackman fair value$9.73

  ✗Ackman-29.5% margin vs $12.60
• Profitability6% pass✓ 4✗ 31▾

  15 of 16 flag QXO's profitability — Graham, Buffett, Lynch +12 more

  Positive EPS (10 years)7/19 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)9/19 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)-4.2%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)-3.6% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$-249.2M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE-4.9%

  ✗Lynch> 15%

  EBIT / Enterprise Value-2.1%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=-2.1%, ROC=-5.7%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets-1.76%

  ✗PiotroskiROA > 0

  ROA Change YoY0.55% -> -1.76% (delta: -2.31%)

  ✗PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=1.65%, ROA=-1.76%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY40.6% -> 23.0%

  ✗PiotroskiImproved YoY

  Pre-Tax Income / Revenue-4.8%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity-4.9%

  ✗Dreman> 12%

  Margin of SafetyP/B=0.9x

  ✓PabraiP/B < 1.5 or P/E < 15

  Return on Equity-5.5% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency9/16 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue-3.4%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity-4.9%

  ✗Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend-2.4% (2023) -> -3.6% (2025)

  ✗TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendgross margin 39.6% -> 23.0%, operating margin -2.4% -> -3.6%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Net income / market capitalization-3.91%; #3767/6340 (top 59.4%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets+10.49%; #2762/3702 (top 74.6%)

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity-4.93%; #3205/5226 (top 61.3%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0192; #1403/5884 (top 23.8%)

  ✓AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-15.0% over 5 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years4/10 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Growth13% pass✓ 5✗ 8▾

  7 of 8 flag QXO's growth — Graham, Lynch, Dreman +4 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 12.0% vs Rev: 408.2%

  ✓LynchInventory growth < Revenue growth

  EPS Growth Direction

  ✗DremanPositive over recent years

  EPS CAGR8.0% CAGR over 9 years

  ✓Dreman> 5% annualized

  Positive Net Income Frequency9/16 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth21.2%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendgross margin 39.6% -> 23.0%, operating margin -2.4% -> -3.6%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR178.0%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-15.0% over 5 years

  ✗Neff7%-20% annualized
• Efficiency25% pass✓ 3✗ 8▾

  6 of 8 flag QXO's efficiency — Buffett, Greenblatt, Piotroski +3 more

  Current Ratio4.11

  ✓Graham>= 2.0

  ROIC (3-5 yr avg)-7.9%

  ✗Buffett> 10%

  ROIC - WACC-17.9%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)-5.7%

  ✗Greenblatt> 25%

  Current Ratio Change YoY112.85 -> 3.58

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.01x -> 0.43x

  ✓PiotroskiImproved YoY

  Current Assets / Current Liabilities4.11

  ✓Dreman> 1.5

  Return on Invested Capital-1.6%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=-11.3%; FY2024: ROIC=-1.1%; FY2025: ROIC=-1.5%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROICN/A (non-positive net income)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)0/5 years above 12% (latest -1.5%)

  ✗SleepROIC > 12% in a majority of years
• Verdicts33% pass✓ 5✗ 10▾

  Split decision: 9 FAIL · 5 PASS · 2 NEUTRAL

  Overall verdict

  ✓GrahamPASS (4/9)✗BuffettFAIL (0/9)✗LynchFAIL (2/7)✗GreenblattRank #1944✗PiotroskiFAIL (F-Score 3)✓DremanPASS (5/11)✗MungerFAIL (0/4)✗PabraiFAIL (1/3)✗AkreFAIL (1/6)✗MarksFAIL (3/5)✓AckmanPASS (4/9)✓TempletonPASS (4/8)✓SleepPASS (3/6)✗AsnessFAIL (Rank #1770/2370 (Top 74.7%))✗NeffFAIL (2/6)•SchlossNEUTRAL (4/7)•OshaughnessyNEUTRAL (Not ranked)
• Debt & Leverage42% pass✓ 7✗ 8▾

  7 of 12 flag QXO's debt & leverage — Buffett, Lynch, Piotroski +4 more

  LT Debt vs Net Current AssetsLT Debt $6.0B vs NCA $7.8B

  ✓GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.59, IC: -1.4x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.59

  ✗Lynch< 0.33

  Cash - Long-term Debt$-3.3B

  ✗LynchPositive preferred

  LT Debt / Total Assets Change0.00% -> 19.24%

  ✗PiotroskiDecreased YoY

  Current Assets / Current Liabilities4.11

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.59

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Debt Levels0.59

  ✗MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  Interest Coverage & Debt/EBITDAIC=-1.4x, D/EBITDA=N/A

  ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.59

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.5860; #2635/4210 (top 62.6%)

  ✗AsnessTop 30% of eligible cross-section
• Cash Flow50% pass✓ 6✗ 6▾

  5 of 10 pass — Buffett, Dreman, Pabrai +2 more object

  Free Cash Flow Proxy$-249.2M

  ✗BuffettPositive and growing

  FCF Positive and Growing$183.2M

  ✓LynchPositive and growing

  Operating Cash Flow$261.4M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=1.65%, ROA=-1.76%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)32.5x

  ✗Dreman< 8x

  P/E or FCF YieldFCF Yield=1.4%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive14/16 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap1.7%

  ✗Ackman>= 4%

  Price / FCF per Share46.4x

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency14/16 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$140.6M

  ✓Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization+1.07%; #2387/4519 (top 52.8%)

  ✗OshaughnessyTop 10% of eligible cross-section