Investor Workbench / Due Diligence / Quality of Earnings · Free

Quality of Earnings Analyzer

Paste 3 years of P&L line items and the analyzer surfaces the adjustments a buy-side QoE provider would flag — one-time items, margin volatility, SBC dependency, persistent "one-time" charges, and customer concentration — then produces a normalized Adjusted EBITDA schedule. Pure browser computation; nothing leaves your device. When you're done, hand the schedule to the Pro+ Memo Generator — it carries this QoE schedule into a full investment-committee memo backed by the 10-agent diligence panel.

1. Paste Your P&L

Tab- or comma-separated. First column = line item; columns 2-4 = years (oldest → newest, $M). The analyzer recognizes ~30 common P&L labels and is forgiving on casing. Try the "Load example" button to see the expected format.

2. Customer Concentration (optional)

Top-5 customers by % of latest-year revenue. A top-1 over 20% or top-5 over 50% triggers a concentration flag. Leave blank if undisclosed.

Rank	Customer name	% of revenue

Findings & Adjusted EBITDA

QoE Flags

Adjusted EBITDA Schedule

Adjustment	Year 1	Year 2	Year 3 (LTM)

Take this to the next level

The Pro+ Memo Generator carries this exact QoE schedule into a full IC memo:

Carries this QoE schedule over — "Open Memo Generator" below hands off the schedule + flags so the memo opens with a Quality-of-Earnings section already populated
Runs the 10-agent Investment Committee panel for a structured BUY / HOLD / SELL (or COMPELLING / WATCH / PASS) verdict with conviction
Saves the memo + QoE schedule to your Saved Reports, where it's searchable from the /intelligence inbox
Roadmap: auto-ingesting filings (10-K / 10-Q / S-1) to populate the P&L for you, and scoring findings against a live peer-percentile database — today the analyzer uses transparent, labeled sector heuristics (see flags), not a peer database

Open Memo Generator → See Pro+ pricing

How the analyzer works

1. Line-item matching — Each row of your input is matched against a ~30-entry whitelist of standard P&L labels (Revenue, COGS, Gross Profit, SG&A, R&D, D&A, SBC, Restructuring, Litigation, M&A costs, Impairment, etc.). Matching is case-insensitive and tolerates common aliases ("Selling, General & Administrative" ↔ "SG&A").

2. Reported → Reported EBITDA — Operating Income + D&A. If Operating Income isn't supplied, Revenue − COGS − SG&A − R&D is used as a fallback.

3. Normalization (standard add-backs) — The analyzer adds back items most QoE providers treat as non-recurring or non-cash:

Stock-based compensation (treated as cash for "Adjusted EBITDA" in PE practice — the contentious one)
Restructuring & severance
Litigation settlements (one-time)
M&A transaction costs (one-time)
Impairment charges (non-cash)
Material gains/losses on asset sales

4. Flag generation — Heuristics flag the patterns a deal team would chase:

Margin volatility: gross or operating margin moves > 300 bps year-over-year without a stated explanation
SBC dependency: SBC > 8% of revenue or > 50% of reported EBITDA (margin is "earnings quality is paper")
Persistent "one-time" items: restructuring or M&A costs in 2+ of the 3 years (they're recurring, not one-time)
Customer concentration: top-1 > 20% or top-5 > 50%
Reported EBITDA < 0: signals the multiple is meaningless without the path to profitability

5. Heuristic intensity bands — The free analyzer scores each add-back as a % of revenue against transparent, hard-coded reference bands (e.g. SBC: <3% typical · 3-8% elevated · >8% high for software). These are rules of thumb, not a peer-percentile database — they tell you whether an adjustment is large relative to common practice, nothing more. A real per-sector percentile benchmark is on the roadmap for the Pro+ path.

What's intentionally NOT in the free version — Working-capital normalization (requires balance-sheet inputs), bridge from EBITDA to Cash Flow, run-rate adjustments for in-period acquisitions, lease accounting (ASC 842 / IFRS 16) treatment, deferred-revenue waterfall, a live sector-comparable percentile database, automatic filing ingestion, and the full IC memo. Those land in the Pro+ Memo Generator.

Educational due-diligence tool — not investment advice and not a substitute for a buy-side QoE engagement with a licensed firm. The flags raised here are pattern heuristics, not opinions on management or auditors. QuantLogix is a research platform.