The Scout Mid Cap Equity Strategy seeks long-term growth of capital while aiming to consistently outperform the Russell Midcap® Index throughout a full market cycle (three to five years) with less than commensurate risk.
We believe actively managing a portfolio of attractively valued, high-quality mid-cap companies which we expect to benefit from company specific or macro catalysts, can generate superior long-term, risk adjusted relative performance throughout market cycles.
We conduct disciplined, bottom-up research on mid-sized companies that are likely to benefit from prevailing sector or industry themes, with particular focus on these factors:
- Financial strength: analysis of the company’s cash flow, income statements and balance sheet
- Determine intrinsic value:
- Discounted earnings model – proprietary model with customized inputs; used to measure upside potential
- Relative Valuation – downside risk assessment using measures such as price-to-book, price-in-earnings, etc.
- Catalysts for appreciation: identify catalysts that can be company specific or top-down and may include management change, new market or a technology change
- Company-specific risk: analyze accounting and revenue recognition to determine earnings quality
- Macro theme formulation: A top-down overlay includes the team’s monitoring of key economic and sentiment indicators, which helps the portfolio managers formulate the macro themes that influence sector and industry allocation.
Patrick Dunkerley, CFA
Lead Portfolio Manager
John Indellicate, CFA
Derek Smashey, CFA
Jason Votruba, CFA
Eric Chenoweth, CFA
Senior Investment Analyst