What does it mean that a stock is cheap?

"Cheap" doesn't mean "Low P/E"

Bird’s eye perspective: Do you have an overview of the big picture for the investment idea?

Will you get more money back than you invest, and when?

Is the company “cheap”?

Is the company durable? Will it continue to churn out the same kind of profits or profit growth rates. How, and why can you be sure?

Is the rate of return reasonable, i.e. the economic value creation lasting? A very high ROE can be hard to sustain due to competition, unless the company has some lasting competitive advantages, also known as moats

Is customer demand healthy and durable? How are the customers doing? Are they paying on time, for example?

Are the debts optimized, or too high/low? Too much debt can be dangerous if interest rates rise. And too little might be inefficient.

Technical analysis: does the market like the company? Is the trend in your favor?

Is the macro situation normal/extreme? Does it provide a headwind or a tailwind?

Is the case rational and value creating, or a Ponzi? Can you pitch the idea clearly, convincingly and concisely?

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The Investing Course