Equity investing

Individual bottom-up security selection is the cornerstone of our equity approach. We are stock pickers who examine quantitative and qualitative factors to measure a company's potential, insisting on strong balance sheets, revenue and earnings growth, as well as strong competitive positioning and international leverage. We speak one-on-one with senior management about their company's business plan, ability to manage growth and commitment to paying dividends, with only the best 40 to 50 companies making it into a portfolio with strict buy, hold and sell criteria attached to each holding.

Process in action

Screening. We screen TSX-listed names to isolate about 150 potential portfolio candidates and generate ideas. We look for companies with sustainable earnings growth, histories of rising dividends and positive future catalysts such as new product offerings, a favourable regulatory change and M&A potential
Fundamental analysis. To be considered for inclusion into our portfolios, a company must undergo fundamental analysis – qualitative and qualitative. Qualitatively, we look for proven management ability, demonstrated market leadership and solid industry prospects among others. In our quantitative analysis, we look for companies with strong and improving financial results, high returns on capital and strong balance sheets
Macroeconomic view. A key complement to our fundamental security analysis is forming our top-down macroeconomic view. We consider inflation, employment, credit availability, GDP as well as industry-related factors
Valuation. We spend a lot of time on valuation. Good companies don’t always make for good investments. Price is important to us. We use proprietary tools to attach price targets to portfolio holdings and candidates.