5 principles we follow to make decisions.
First, we look for moats that last.
We focus on businesses that are hard to displace, where customers stay because switching takes time, money, or risk. That advantage can come from brand, scale, network effects, or regulation. The proof is in durable margins, steady returns on capital, loyal customers, and cash generation that grows with time.
Second, we are patient.
We build positions we can hold for years, not quarters. We focus on fundamentals, not headlines. We exit when the original case no longer holds, when returns on capital fall below our hurdle, or when capital can earn more elsewhere. We add when value and conviction are both high.
Third, we look for good deals.
We aim to own durable, well-run companies trading below intrinsic value. That often means looking where sentiment is weak or attention is elsewhere. We base value on normalized earnings and cash flow, not stories, and we let time and execution close the gap.
Fourth, we look for aligned operators.
We look for leaders who think and act like owners. They have real skin in the game and focus on building long-term value per share. The best ones reinvest in high-return projects, buy back stock when it makes sense, stay disciplined on acquisitions, and are transparent about performance and capital decisions.
Fifth, we look for financial strength.
We want businesses that generate real cash, keep leverage under control, and can fund growth without stretching the balance sheet. Strong margins and consistent free cash flow let them stay flexible when conditions change. We care about the quality of earnings, not the presentation. Cash conversion, capital discipline, and steady per share growth tell the real story.