Our investment philosophy is based on two key tenets:
- We believe earnings growth drives stock performance over time.
- We believe short-term inefficiencies in the market can create attractive entry points.
For more than 30 years, we have followed a focused and disciplined investment process that results in concentrated, high-conviction portfolios with high active share.
Screening and Ranking
Our focus is on companies in the first quartile of our proprietary ranking tool; they have 10% or better prospective EPS growth over the next 3 to 5 years and appear relatively undervalued.
Research and Selection
Typically, 8 to 15 constituents reach the first quartile each month and are then subjected to rigorous in-depth research. As a result, very few constituents ultimately become portfolio holdings.
New positions start in the first quartile but typically move into the second and third quartiles as investments mature. Stocks become sale candidates if they move into the fourth quartile or growth drops below 10%.