The Brina Gap measures the difference between the growth a company can self-finance —
its return on invested capital (ROIC) times reinvestment rate — and the growth its
market price already assumes, recovered from a reverse discounted cash flow on
enterprise value. Validated on the complete point-in-time S&P 500 (2010–2024,
survivorship-free): market-implied growth genuinely tracks the growth firms deliver
(correlation ≈ 0.5), the Gap detects over-extrapolated growth expectations, its
expensive-side calls were right 58.9% of the time, and it ranks first among all pure
valuation metrics tested — above book-to-market, earnings yield, EPV, and the Margin
of Safety. v3.0 ships in two parts: the paper and the complete empirical record,
including the Brina Matrix (quality × pricing) and its value-trap rule.
A survivorship-free audit of sixteen fundamental stock screens — ROIC, value, momentum,
and quality — on the complete point-in-time S&P 500 (2010–2024). Return on invested
capital is the most predictive screen of them all (rank correlation +0.11, quintile
spread +3.0 pp/yr, stable in both halves of the period); the textbook sustainable-growth
screen (ROIC × reinvestment rate) cancels itself out — the sustainable-growth
paradox; book-to-market was the single worst screen of the era; the celebrated
academic quality screens fade on large caps; and after risk adjustment no screen earns
alpha — on the large-cap S&P 500 these screens deliver factor tilts, not a free lunch.
Companion to the Brina Gap working paper: same dataset, same pipeline.
This note documents the construction and historical behaviour of the Zyberno Market Valuation Score, a single
0–100 reading blending the Buffett Indicator, Shiller PE, yield curve and credit spread. Rebuilt monthly from
1986–2026 across four recessions, the score is strongly inversely related to subsequent 10-year S&P 500
returns (r = −0.78) but is not a recession-timing tool, and resists weight optimization — both the in-sample
and least-squares optima fail out-of-sample, while a simple robustness-validated weighting (20/40/30/10)
generalises. Market sentiment adds no predictive power. Presented with full limitations.
Zyberno Research produces original frameworks for equity analysis and investment
decision-making. Work is grounded in fundamental finance theory and validated
against empirical data. All papers are freely available and permanently archived.
Open Access & Archival
All working papers are deposited with
Zenodo
(CERN European Organization for Nuclear Research) under a persistent DOI
and licensed under CC BY-NC-ND 4.0.
Principal Researcher
Fabio Brina
(ORCID: 0009-0007-5715-7681) · Affiliation: Zyberno.com ·
Founder of Zyberno and creator of the Brina Gap equity valuation framework.
Series
The Zyberno Working Papers series disseminates pre-publication and
independent research in financial economics. Papers are indexed by DOI and
citable immediately upon publication.
Contact
Research enquiries, correspondence, and collaboration requests:
[email protected]