Our philosophy

Our investment philosophy is focused on portfolios containing shares in a limited number of listed companies, selected after a rigorous bottom-up analysis.

We want to invest in companies with stable, transparent, predictable and growing free cash flows, with an attractive valuation and measured risk profile.

Our goal is to invest in companies with the long-term potential to creative attractive and positive returns for shareholders.

Fundamentally, our analysis can be divided into two parts: First, we do a qualitative evaluation of the business model of a company. We prefer companies with clear competitive advantages, such as strong market positions with clear advantages of scalability and significant barriers to entry, and/or strong brands, with significant and clear pricing power.

Furthermore, we want companies with an attractive growth potential, for example through exposure to markets that are structually expanding, but preferably through a combination of market growth and growing market share.

We also analyse the capital requirements of the business model, and prefer capital-light business models. Finally, we are looking for companies with an attractive earnings potential and a strong and stable return on invested capital.

We also evaluate capital allocation, and are looking for companies with a proven track record of returning capital to shareholders through dividends and/or share buybacks, if capital is not required by the company for investments with high return opportunities.

Finally, we want to be co-owners of companies with a management that is credible, that are shareholder-friendly, have a strong proven track record and are able to plan and act strategically and for the long term.

In the second part of our analysis we focus on valuation and risk analysis, and in regard to risk, we examine in particular volatility in cash flows (cash flow beta), and the valuation of free cash flows.