We specialize in wealth enhancement through tax-efficient, growth-oriented investment management. Client portfolios are generally kept fully invested, resulting in low turnover of portfolio holdings and reduced exposure to capital gains liabilities. Our equity growth approach involves identification and purchase of companies with superior growth characteristics, with the intention of holding them for many years and selling only when fundamental prospects turn negative.
A cornerstone of our philosophy is our focus on buying dominant companies in the fastest-growing industries. Generally, we seek companies that increase revenues and earnings by double-digit growth rates year after year. Such businesses ordinarily prosper under a variety of economic conditions, and most are corporate leaders in profitability. These companies tend to be both proponents and beneficiaries of the long-term themes that are shaping global economies. Today, many of these companies are found within the technology, healthcare, financial services and consumer sectors.
Companies that meet our criteria for growth typically share the following traits:
A dominant position in rapidly growing markets
These companies are often the low-cost suppliers or pricing leaders in their industries. Their dominance often derives from powerful franchises, proprietary technology, a unique marketing approach or other sustainable competitive advantages.
Predictable earnings growth
Prospective earnings should grow at an annualized rate of 15% or more. Steady new product developments, rapid sales expansion and a relative immunity to economic cycles characterize these companies.
Financial attributes include low debt, high returns on equity and capital, and an ability to finance growth internally.
Ideally, management should have an ownership stake in a growth company. This fosters a commitment to shareholder interests and creates an entrepreneurial culture that will attract skilled employees. Communication of the corporate vision for growth to both shareholders and employees is essential.