How the HDB Score works

The HDB Score is a single number, shown out of 10 on every stock, that rates how strong and how consistent a company's revenue and profit have been over the period you choose. Higher means a longer, steadier track record of real business results — nothing more, and nothing less.

What the score is actually measuring

Most screeners drown you in dozens of metrics and leave you to weigh them. The HDB Score does the weighing for you, on purpose and in the open. It asks one question: over the last N years, did this business grow its sales and — more importantly — its profits, and did it do so consistently rather than in a lucky spurt? It rewards durability, not drama.

It is a comparative measure. A company is scored against the whole universe, so a 9 means “among the strongest track records we track,” not an absolute certificate of health. Change the period (1Y through 30Y) and the score changes with it, because a company's story is different over one year than over twenty.

The eight signals

The score combines eight signals, drawn from two things every business reports — revenue and net income — looked at four ways each:

• Growth — did revenue and profit expand over the period?
• Consistency — did they grow in most years, or did a single year carry the whole period?
• Predictability — did the numbers track a steady compounding path, or lurch around it?
• Scale — how much cumulative revenue and profit the business actually produced, in a common currency.

That is four lenses on revenue and the same four on net income — eight signals, each scored on the same footing so they can be combined into one number.

Why profit is weighted above revenue

The eight signals do not count equally. Net-income signals carry roughly two-thirds of the score and revenue signals about one-third. The reason is simple: sales that never turn into durable profit don't compound a business's value over the long run. Revenue shows that customers want the product; profit shows the business is worth owning.

These weights are fixed and disclosed in advance. We don't tune them to make any historical result look better — a temptation we write about in the methodology.

How to read a score

On a stock page you'll see the score as, say, 8.4 / 10 for the selected period. Read it as a percentile-style rank of long-term financial strength:

• A high score = steady, compounding revenue and profit over many years.
• A middling score = real growth undercut by lumpiness, thin profitability, or a short history.
• A low score = stagnant, shrinking, or loss-prone financials — losses and negative years count against a company.

If a period doesn't have enough data to score honestly, it isn't scored at all — a company without ten years of history simply has no ten-year score, rather than a guessed one.

A quick example

Picture two companies over ten years. The first grew profit in eight of ten years along a smooth line; the second doubled profit in a single blockbuster year and drifted the rest of the decade. Their total growth might look similar, but the first scores far higher — because the score rewards the eight-out-of-ten consistency, not the one-year spike. That is exactly the difference a lone growth percentage hides, which is why we built the score around consistency and why it's worth reading the full history before you judge a number.

What the score is not