Our Approach

Our Equity Investment Approach:

Investing for the Long-Term in a Diversified Portfolio of Fundamentally Sound Consistent Growth Companies at a Reasonable Price. 

We focus on identifying consistent growth companies offering above-average return potential regardless of their size or geographic location.  Those companies typically possess the following characteristics:


Sustainable competitive advantage.  A sustainable competitive advantage is what differentiates a company from its competitors.  This includes such things as providing a superior product or service, having the leading market share, being the low-cost producer, possessing a superior distribution system, utilizing better technology, having superior research and development technology, or offering the best customer service.  Trademarks, trade names, and patents also provide compelling competitive advantages.


Superior management that acts in the shareholders’ interest.   Management should have a defined business objective and strategy.  It must use the company’s assets wisely and invest to generate superior levels of profit and growth.  They must be innovative and able to anticipate and act on change.  In addition, management must apply high standards of corporate governance and truly think of shareholders as owners of the business. A high level of management ownership in the company better aligns management with shareholders and is viewed positively. 


Long-term track record of revenue and EPS growth.  The company should have reported consistent revenue and EPS growth over the past 5-10 years or more.  To continue such a record, demand for its products or services must be growing, as cost containment and margin improvement will not last forever.  The consistency of reported EPS also demonstrates recurring and predictable demand for the company’s products or services.  A company that exhibits this consistency will most likely have below average vulnerability to a downturn in the economy. 


Leader in a growing industry.  The company’s end-markets should be growing faster than the overall economy.  The company should be a leader and innovator, not necessarily the largest.  The rate of internal growth (as opposed to growth from acquisitions) is important because it will provide a sustainable annual return and increase the value of the company over the long-term.  


Strong balance sheet.  A company with a strong balance sheet (low net debt-to-capital) should have the capacity to finance its growth. A company’s operating income should provide a very secure level of interest coverage under varied economic conditions.  A solid balance sheet will help reduce volatility in reported earnings during an economic recession, as well as reduce the risk of charges from write-downs.


Generation of free cash flow – The best businesses tend to be relatively less capital intensive and generate significant free cash flow.  Free cash flow can benefit shareholders in many ways, such as share repurchases, debt reduction, or strategic acquisitions. 


Attractive ValuationAfter finding a company that meets most, if not all, of the above criteria, it is critical to investment success to have the discipline to wait for the appropriate purchase price.  Key valuation determinants include a company’s probable long-term earnings per share growth rate, consistency and stability of estimated growth, profitability, financial condition, projected cash flow, and quality of management.  Our valuation methodology incorporates the use of a dividend discount model as well as relative price-to-earnings ratio (PE) and price-to-earnings relative to expected growth ratio (PEG) analysis.


Our Fixed Income Approach:

A Focus on High Quality Securities and Duration Management. 

Our bond investment approach emphasizes the generation of long-term, consistent returns within the parameters of individual client objectives.   Our staff has experience in a variety of fixed income disciplines, from emphasizing income and principal stability for conservative clients, to applying active duration management techniques for dedicated institutional portfolios.   Our strength lies in our ability to customize a fixed income portfolio to meet the specific needs of each client.  However, several aspects of our philosophy will apply to all fixed income portfolios under our management: 

  • Focus on investment grade securities.  


  • Avoid excessive interest rate risk.


  • Maintain adequate liquidity to ensure maximum flexibility.

Permissible investments include U.S. Treasury securities, government agency issues, corporate securities, preferred stocks, municipal bonds, mortgage and asset-backed issues, certificates of deposit, fixed income mutual funds, exchange traded funds (ETFs) and high quality money market funds

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