In the previous chapter we looked at how you actually find interesting stock ideas in the first place, whether through media, screeners or simply through your everyday life and the products you love. At some point, however, you always arrive at the same question. How do you check in a systematic way whether a nice idea can really become a solid fair value stock. This is exactly the point where the Premium Tools start to show their real strength. At their core they are nothing more than a shortcut through all the detailed work you would otherwise have to do with many websites, annual reports and Excel files.

Your starting point in this toolbox is the Premium Dashboard in the free trial or with full access. You can think of it as a control centre. There you see your watchlist, new fair value stocks, a preview of the screener and the latest analyses in one place. The watchlist is your personal list of favourites. From the screener or from the individual stock pages you can add interesting stocks to the watchlist with a single click. In this list you then follow over time how price and fair value move in relation to each other. The fair value is updated continuously, you see whether the gap is widening or shrinking, and you recognise which positions are slowly leaving the undervalued zone or just entering an attractive range.

Below the watchlist you find the Portfolio Manager. Its entire job is to remind you, politely but firmly, that a handful of favourite stocks is not yet a stable portfolio. It checks the distribution by region, sector and company size and only turns the lines green once a sensible level of diversification has been reached. The goal is a picture where as much as possible is green and the diversification bar is full. In your profile you can also set alerts that notify you by email when something important changes in your watchlist.

A second core element is the stock screener. On the dashboard you see a small preview that already lists a few candidates. With one click you open the full screener where you can filter thousands of stocks by fair value and key figures. The default settings are chosen so that solid candidates appear first. You can select the region, define how many stocks should be shown, sort by distance to fair value and filter by metrics such as earnings growth, debt, margins or dividends. There are also predefined strategies based on well known investors and classic investment approaches. With a few sliders you can filter out extremely speculative cases so that in the end a manageable list remains. That list is where the real work begins, the closer analysis on each individual stock page.

These stock pages are essentially company dossiers. They show the calculated fair values, the most important ratios, charts for revenue and earnings, a sector comparison and indications of quality and relative strength. Taken together this creates a clear picture quite quickly. You see whether you are dealing with a robustly growing company with understandable numbers or with a stock where the price is driven by a lot of imagination while the fundamentals move like a roller coaster from year to year.

The calculated fair value is at the centre. This number is not derived from a single formula but from several approaches that are visible on the page. Next to a fair price earnings multiple that comes from a quality test, cash flow models and other valuation building blocks are included. The more reliable data is available for a company, the more precise the automatic fair value can be. On top of that the fair value is adjusted up or down depending on quality. Companies that score very well on quality and stability receive a premium. Weaker candidates receive a discount. In practice this means you should focus mainly on stocks that show long and rich data histories and be careful with extreme outliers where the fair value is supposedly several hundred percent above the current price. Such cases always deserve a second look to check for outliers or special effects in the numbers. Consistent revenue growth makes a clean assessment much easier.

A very useful quick check on the stock page are the revenue and earnings charts. They show in a single row how revenue has developed over several years. Ideally the bars rise in a fairly calm way without heavy drops or wild zigzag patterns. In such a case you can be much more confident that projections for the future have some reliability. If the curves instead look like an ECG right before cardiac arrest, they are telling you something. A lot of noise, many special items, possibly cyclical or very sensitive business models. In these situations you should not let yourself be dazzled if the automatic fair value still looks high. The number may be calculated correctly, but it rests on shaky foundations. For beginners it is usually wise to focus on the clear, calm cases and larger companies and to push complex special stories and small caps further back on the list.

Beyond these charts other ratios support your assessment. The price earnings ratio and the PEG ratio show how the current price relates to earnings and to growth. A high price earnings ratio can be perfectly reasonable in a fast growing business, but in a stagnating conglomerate it often points to exaggeration. The price to book ratio and price to sales ratio complete the picture. They are especially useful in sector comparisons. Capital intensive industries naturally have different typical ratios than asset light business models. For that reason it makes sense not to look at a stock in isolation, but always in relation to its direct competitors in the same sector.

That is the purpose of the sector comparison on the stock page. There the company is compared metric by metric with the average of its sector. If a metric is clearly better than the sector average, the field turns green. If it is significantly worse, it turns red. If you want to keep it simple, you make sure that the most important fields are more green than red. This comparison is particularly powerful when you use it together with the revenue and earnings charts. Then you see whether a company looks good only on paper or also stands out positively among its peers.

Another building block is performance and relative strength. This is less about finding the exact entry point and more about avoiding stocks that are permanently weak just because they look cheap. Relative strength compares the performance of a stock with the overall market over different periods of time. If a stock has been consistently weaker than the market for six or twelve months, caution is advised. Experience shows that buying into a long lasting downtrend is rarely a good idea, even if the fair value on paper is higher. It is better to look for cases where the distance to fair value is attractive but relative strength is at least not extremely negative. A simple rule works well in practice. It is pleasant when the long term trend is intact, the price occasionally drops below the inner value and then returns, and the moving average is rising with the price trading above it. It is less attractive when the elevator has only been going down for years.

All of this information flows into the Fair Value Rating. This overall score is not a magic oracle. It is a compressed summary of valuation, quality, stability and price behaviour. You can see at a glance whether a stock sits more in a healthy zone or whether several warning lights are on at the same time. The score does not replace your own thinking, it simply saves time. Instead of checking every single ratio from scratch you can look at the score first and then zoom into the areas that look particularly strong or particularly risky.

The Premium Tools also help you understand the overall market and sectors, not just individual names. The market analysis tool summarises typical valuation ratios such as price earnings, price book, price sales and dividend yield for major indices and relates them to their historical averages. Put simply it shows you whether a market segment appears cheap, fairly priced or clearly overheated. Values far below the normal range point to a rare cheap phase. Very high values indicate an expensive environment. Such extremes occur less often than headlines suggest and expensive phases can last for a long time. It is still very helpful to know in which environment you are operating so that you can adjust your risk appetite.

The sector analysis tool goes one layer deeper. It ranks sectors by ratios such as price earnings and price book and makes visible which sectors are cheaper and which are more expensive at the moment. In many cases it pays to start your search in those sectors that sit in the lower valuation third and at the same time have business models you can understand. Complex areas such as banks or certain commodity segments are often harder to assess if you do not spend a lot of time with them. For many investors it is therefore more sensible either to cover such sectors through broad ETFs or to avoid them entirely instead of analysing them into a false sense of precision.

On the dashboard you will also find sections for new fair value stocks and new analyses. Here you see stocks that have been newly added to the database or where the distance between price and inner value has changed significantly. You also see current in depth analyses in which individual companies are examined in more detail. None of this is a guarantee of profit, but it is an efficient filter that helps you quickly identify where something interesting is happening.

Finally there is the simple single stock search. If you already have a specific company in mind, you can use the search function to check whether the stock is in the database and which fair values and key figures are available. This is especially useful if you want to be sure your core holdings are covered before you register for the Premium version. In practice you will find that the vast majority of relevant global stocks are already included, but checking gives you extra confidence.

With that the toolbox is essentially complete. From the dashboard to watchlist and portfolio manager, from screener to stock pages and from market to sector analysis, everything is in place to turn spontaneous ideas into a structured process.