Identify high quality businesses for which we can develop conviction in a multi-year view of earnings power which is significantly above that embedded in the stock price.
Seek to invest in highly forecastable, sustainably advantages businesses which have greater control over their outcomes and are better insulated from impact of unknown variables.
We believe that over time stock prices reflect earnings and cash flow expectations. A differentiated view is therefore a critical ingredient in long-term outperformance.
Buy stocks at modest valuations based on our own forecast in order to provide a margin of safety and monetize our insights.
Purposeful concentration through balance of:
Only owning favorite ideas vs. returns primarily driven by stock specific risk/return profiles
Potential to generate excess return vs. consistency and correlation of returns with mandate