Economic Moats/Competitive Advantages

Companies that dominate a specific niche or industry through network effects, intangibles, switching costs, or economies of scale

Higher returns on invested capital relative to peers and on an absolute basis

Free Cash Flow Generation/Growth

Companies that generate free cash flow with a path towards growing that free cash flow stream in the future

Companies that may not generate free cash flow today with a clear path towards future free cash flow generation

Downside Protection

Companies that possess a substantial margin of safety

Asymmetry

Companies trading at levels where we believe the stock’s upside return potential significantly outweighs potential downside scenarios

Management

Companies run by trustworthy management teams that have demonstrated high-quality strategic, operational, and capital allocation decision making abilities

Companies where management is aligned with long-term investors and focused on long-term value creation