Methodology
Data sources
Financial indicators come from the Aswath Damodaran database (NYU Stern), which consolidates public information from listed companies globally. For the Latin American companies included in the Observatory, financial data is obtained from published annual reports and sources such as Yahoo Finance. The sectors currently covered are: Food Processing, Building Materials, and Retail. Each sector includes between 10 and 25 companies with at least 5 years of comparable financial data. The thresholds defining the matrix quadrants (revenue growth and net income growth) are derived from the 5-year sector averages published by Damodaran.
How indicators are computed
The compound annual growth rate (CAGR) is calculated for revenue and net income over the available period for each company. The formula used is: CAGR = (Final value / Initial value)^(1/n) - 1, where n is the number of years. Quadrant assignment compares each company's growth against sector averages. A company with revenue and profit growth above sector is placed in the value creation quadrant. The remaining combinations define the simple growth, efficiency seeking, and underperformance quadrants. Archetype detection analyzes the sequence of quadrant positions over time. The 7 archetypes (sustained creation, growth pendulum, momentum trap, efficiency plateau, incomplete liftoff, silent contraction, and mixed trajectory) are assigned based on patterns, not fixed thresholds.
Limitations
This instrument uses exclusively data from publicly listed companies. Private mid-market Latin American companies, which constitute the primary audience, are not represented in the reference data. Financial data is reported in each company's local currency. Comparisons between companies from different countries do not adjust for exchange rates or local inflation. There is an inherent lag between the publication date of financial statements and their availability in the databases used. The most recent data may be between 6 and 12 months old. Trajectory archetypes are descriptive, not predictive. They identify historical patterns but do not imply causality or project future behavior.
How to cite this instrument
Erea Decision Labs. StratEx: Profitable Growth Instrument. usestratex.com, 2026. Reference data: Damodaran Online (NYU Stern).