Value
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.4 |
| P/S | 10.0 |
| EV/EBITDA | 5.5 |
| Fwd P/E | 9.1 |
| PEG | 10.0 |
| Analyst target | 7.5 |
- ▸Forward P/E: 11.6x
- ▸PEG: 0.05
- ▸Attractively valued
ADIG · Why this verdict
Why ADI Global Distribution (ADIG) is rated SELL
Updated
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VerdictSELL
Overall score5.6/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
ADI Global Distribution screens as inexpensive on earnings-based multiples with a very low PEG ratio, though the underlying business shows weak margin quality and no identified competitive moat. Insider activity is mixed, with institutional accumulation alongside a net insider share sale, and analyst sentiment is only lightly covered.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock screens as inexpensive on an earnings basis, with a forward P/E near 11.1x and an unusually low PEG ratio of 0.05 relative to its expected earnings growth. Valuation breakdown | The valuation should re-rate higher toward peer multiples as growth is realized, all else equal. | ↓Deteriorating |
| CounterThe extremely low PEG of 0.05 may reflect an unreliable or transient earnings-growth estimate rather than genuine undervaluation, and the business already screens weak on quality with no competitive moat. | ||
Business quality screens weak on this framework, with gross, operating, and net margin components all sitting near the bottom of the scale and no competitive moat identified. Components | Margin quality should improve, with the gross, operating, and net margin readings strengthening from their current weak levels. | →Stable |
| CounterSustained thin margins without a moat leave the business vulnerable to competitive pressure, and nothing in the data points to a near-term margin inflection. | ||
Institutional ownership is reported as accumulating even as the most recent individual insider transaction registered a net share sale, a mixed signal on positioning. Insider breakdown | Institutional buying should continue or broaden, and subsequent insider filings should not repeat the net-selling pattern. | →Stable |
| CounterThe net insider transaction data shows shares sold rather than bought, zero buys against one sell, which directly counters the accumulation read and could reflect insiders viewing the stock as fully valued. | ||
Analyst sentiment leans moderately constructive, but the coverage note explicitly flags the signal as dampened given the small number of covering analysts. Sentiment breakdown | Analyst coverage should broaden over time, giving the sentiment score more statistical weight and reliability. | ↑Improving |
| CounterThin coverage cuts both ways — it also means there is little independent validation of the constructive read, and sentiment could swing sharply on the addition or loss of a single analyst. | ||
The stock screens as inexpensive on an earnings basis, with a forward P/E near 11.1x and an unusually low PEG ratio of 0.05 relative to its expected earnings growth.
↓DeterioratingValuation breakdown
- Expectation
- The valuation should re-rate higher toward peer multiples as growth is realized, all else equal.
CounterThe extremely low PEG of 0.05 may reflect an unreliable or transient earnings-growth estimate rather than genuine undervaluation, and the business already screens weak on quality with no competitive moat.
Business quality screens weak on this framework, with gross, operating, and net margin components all sitting near the bottom of the scale and no competitive moat identified.
→StableComponents
- Expectation
- Margin quality should improve, with the gross, operating, and net margin readings strengthening from their current weak levels.
CounterSustained thin margins without a moat leave the business vulnerable to competitive pressure, and nothing in the data points to a near-term margin inflection.
Institutional ownership is reported as accumulating even as the most recent individual insider transaction registered a net share sale, a mixed signal on positioning.
→StableInsider breakdown
- Expectation
- Institutional buying should continue or broaden, and subsequent insider filings should not repeat the net-selling pattern.
CounterThe net insider transaction data shows shares sold rather than bought, zero buys against one sell, which directly counters the accumulation read and could reflect insiders viewing the stock as fully valued.
Analyst sentiment leans moderately constructive, but the coverage note explicitly flags the signal as dampened given the small number of covering analysts.
↑ImprovingSentiment breakdown
- Expectation
- Analyst coverage should broaden over time, giving the sentiment score more statistical weight and reliability.
CounterThin coverage cuts both ways — it also means there is little independent validation of the constructive read, and sentiment could swing sharply on the addition or loss of a single analyst.
Per-dimension breakdown
Quality
3.6/10data confidence 86%| Component | Sub-score |
|---|---|
| Gross margin | 0.4 |
| Op margin | 0.9 |
| Net margin | 0.4 |
| Current ratio | 9.4 |
| Moat | 4.6 |
| Piotroski F | 5.6 |
- ▸No competitive moat
Growth
6.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.7 |
| EPS growth | 10.0 |
Momentum
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 2.4 |
| OBV | 1.0 |
| MA position | 3.5 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
Sentiment
7.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Analyst rating | 6.3 |
| Price target | 9.1 |
- ▸Light analyst coverage (4.0) — signal dampened
- ▸Analyst upside: 40%
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
3.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.4 |
| quality rank | 2.9 |
| growth rank | 2.6 |
Technical
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.4 |
| support resistance | 9.7 |
| 52w position | 3.2 |
Risk (lower is worse)
5.0/10data confidence 80%| Component | Sub-score |
|---|---|
| days to cover | 10.0 |
| volatility | 0.0 |
| implied vol | 2.3 |
| debt equity | 7.9 |
- ▸High IV: 66%
Catalyst
5.0/10data confidence 50%How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.3<4.5
- ASYMMETRY:1.2<1.5@spot
Warning (0)
none
Reward-to-Risk
1.24
Upside
+18.6%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($1.6B) below institutional reach
SuitabilityAggressive — MCap $1.6B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 2.3<4.5 outcome against Value at 7.8 and asymmetric R:R of 1.24.
The strongest dimensions are Value at 7.8, Sentiment at 7.6, and Insider at 7.3; the weakest are Momentum at 2.3, Peer rank at 3.5, and Quality at 3.6. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 1.24 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Low Earnings Multiple Valuation
Trip ifPEG ratio rises above 1.0, sharply higher than the current 0.05 reading.
- P2Weak Margin No Moat Quality
Trip ifGross margin, operating margin, and net margin components each improve for at least 2 consecutive quarters, signaling the emergence of a competitive moat.
- P3Mixed Institutional Insider Signal
Trip ifNet insider shares sold exceeds 500,000 shares over a 90-day window, more than 3x the current 150,000-share net sale.
- P4Constructive But Thinly Covered Sentiment
Trip ifThe analyst-rating component falls below 5.0 on its 0-10 scale, signaling sentiment has turned negative from the current level near 6.1.