> ## Documentation Index
> Fetch the complete documentation index at: https://docs.chicago.global/llms.txt
> Use this file to discover all available pages before exploring further.
# Reconciling the Evidence
> Giving each method a defined role, explaining disagreement, and refusing to average correlated evidence into an artificial consensus
Reconciliation assigns each method a defined analytical role, identifies shared assumptions, and explains disagreement. It does not average correlated evidence into an artificial consensus.
## The Economic Question
What does each method know, what does it assume, and which observation would resolve the disagreement?
Reconciliation is a structured explanation. It is not a vote count, and it is not a device for forcing every method toward one recommendation.
This principle does not prohibit every governed blend. A defined client product may combine two compatible sources for a stated purpose. The rule is narrower and more important: the blend must name its inputs, weights, exclusions and decision function, and it must not present itself as an independent intrinsic valuation.
## The Evidence Roles
| Method | Its role | Its principal blind spot |
| ---------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------- |
| **DCF** | Independent operating forecast and intrinsic value | Forecast and terminal sensitivity |
| **Peer valuation** | Current market pricing of related economics | The whole peer group can be mispriced |
| **Sell-side targets** | Published consensus context | Shared assumptions and target clustering |
| **52-week range** | Where the current price sits against the year's trading, which frames anchoring and the levels at which liquidity has recently existed | Says nothing about value, and a narrow range is not evidence of stability |
| **Factor scores** | Systematic return and risk evidence | No company-specific price target |
| **[Reverse DCF](/glossary/reverse-dcf)** | Price-implied expectations challenge | Describes price, not independent truth |
| **Technical analysis** | Timing, execution and risk state | Cannot establish long-run value |
## The Reconciliation Sequence
Name the intrinsic range and its two dominant operating assumptions.
Place the current price inside or outside the DCF and peer ranges.
Growth, margin, ROE, capital intensity or risk should explain the multiple gap.
Compare price-implied growth and margin with the independent case.
Cite source, date and scale. Name the strongest support and the weakest constraint.
State whether current price structure confirms, complicates or delays the thesis.
Identify the observation most likely to resolve the disagreement.
Say what evidence would change the conclusion.
## A Complete Worked Example
An illustrative issuer trades at 100.0. The DCF spans 80.0 to 120.0, with Base at 95.0. Peer context spans 95.0 to 130.0, centered at 112.0. Sell-side context centers at 118.0. Holding the other Base assumptions fixed, the reverse DCF requires 11.0% medium-term revenue growth, against 9.0% in the independent Base case. Factors are Overall 6.4, Value 8.0, Quality 4.0, Momentum 3.0, Defensive 7.0 and Tactical 6.0. Price is above its 20-day average, below its 200-day average, and near resistance.
**The reconciled reading.** The current price lies inside the DCF range but above its Base value, and sits below the peer and sell-side centers. The apparent peer discount is partly explained by weaker Quality, and closing it requires improvement in margin durability. The reverse DCF asks for growth 2.0 percentage points above the independent Base case to justify the current price under the other Base assumptions. Value and Defensive are supportive, while weak Momentum and the unfinished long-term trend argue for patience on timing. The hinge is the next two periods of revenue growth and operating margin. The conclusion weakens if growth stays below 9.0%, or if margin improvement requires reinvestment above the stated corridor.
No undisciplined average of 95.0, 112.0 and 118.0 contains that information.
## Common Disagreement Patterns
The market may expect faster growth, a longer competitive period, lower reinvestment or lower risk. The reverse DCF identifies which assumption carries the gap.
The stock may be cheap relative to a weak or cyclical denominator. Quality and cash conversion decide whether the discount is opportunity or trap.
The long-run thesis and the near-term price path disagree. Technicals help define whether the investor should wait, scale gradually, or demand a larger [margin of safety](/glossary/margin-of-safety).
The peer group may itself price an optimistic regime. Relative cheapness does not make the absolute expectation conservative.
## Interpretation Note
The methods provide related perspectives. Peer valuations, sell-side targets and recent prices can share market assumptions; factor and technical signals can share price inputs; and DCF and reverse DCF use the same valuation identity. Assess the source and independence of the evidence when interpreting agreement.
## How to Assess the Result
Check that the explanation identifies why the methods disagree, assigns each figure a role and date, and distinguishes differences in valuation from differences in timing.
## When to Reassess
The note uses unavailable evidence; averages methods; selects one method without explaining the conflict; cites a factor without date and scale; treats price-implied expectations as an independent forecast; or allows technicals to become a price target.
## How Parallax Applies This
Parallax uses only evidence whose basis, date and analytical role have been established. The reconciliation carries distinct method roles, dated factor evidence, reverse-DCF boundaries and observable falsifiers. It does not produce an all-method composite fair value.
Where a client product defines a narrower target from peer and sell-side evidence, Parallax discloses the formula, the component checks, and any decision to rely on one qualified component rather than the other. DCF, factors, technicals and trading history remain outside that calculation. If a required method is unavailable, the explanation names the missing evidence rather than blaming a different method that remains sound.
**Research finding.** Describes exposures and statistical relationships, not returns or performance. Not investment advice.
The information and opinions in this report were prepared or are disseminated by **Chicago Global Capital Pte Ltd**, regulated by the **Monetary Authority of Singapore**.
This report is **not intended to, and does not, constitute an offer or solicitation** to buy and sell securities or engage in any investment activity. This report is for **informational purposes only**.
Statements in this report are not made with respect to any particular investor or type of investor. Securities, financial instruments, or strategies mentioned herein may not be suitable for all investors, and this material is not intended for any specific investor and does not take into account an investor's particular investment objectives, financial situations, or needs.
Chicago Global Capital recommends that investors **independently evaluate particular investments and strategies**.
The governed client target and the volatility-aware rating gradient.
How to read the published range as an investor.