Asset Management

Individually Managed Portfolios for Growth and Income

Our Selection Process

Our goal is long term appreciation in client stock portfolios through identifying, acquiring and holding stocks of strong business franchises at reasonable valuations.

We believe that positive long-term investment results can best be achieved by holding shares of companies that achieve high profitability on the total investment in the business. These companies must also have the ability to make additional high return investments in sufficient size to produce growth in shareholder value.

Companies which produce high returns on invested capital usually display a combination of characteristics in the way they do business through superiority in either management style, corporate culture, cost efficiency, marketing, patent protection, or new product development. Furthermore, high return companies as a rule have low debt, strong balance sheets, and can fund high levels of capital spending and growth without diluting the shareholder’s interests.

Once we have identified high return/reasonably valued companies, the selection process continues with a series of other evaluations and judgment factors such as the following:

•  Relative historical price/earnings ratio to the company itself, its industry and to the market.

•  The relationship of the historical and projected growth rates to the price/earnings ratio and debt levels of the company.

•  The level and location of sales and earnings in foreign markets.

•  A careful review of historical and current pre-tax and after tax profit margins and earnings acceleration or deceleration.

•  A review of the technical factors which might impact on the price action of the company’s stock.

•  A continuing review of all fundamental external factors such as changes in the economic cycle, interest rates, market valuations, fiscal policy,and monetary policy which may impact the future total returns of the stock market.