Nick Train is a seriously thoughtful growth investor with a highly impressive 40 year track record. He invests in eternal franchises and takes a 20 year view. He says his ideal holding period is forever. He was early to recognise that high quality consumer brands were great investments and accordingly his funds significantly outperformed their benchmarks. More recently, the last five years have been less kind and performance has lagged somewhat with weak performance from some of his biggest holdings, notably Diageo, which is down almost 50% from its peak, in a market which has gone up. Nick has taken this performance to heart and he explains why he has stuck with Diageo and continues to believe it’s as “forever” stock. He also explains his change in strategy to favouring 21st century asset light digital data plays which he sees as even more valuable than his old favourite consumer brands. He is particularly impressed with Rightmove, which I have described in the past as akin to a UK Zillow, and explains his rationale, as well as his enthusiasm for LSEG, RELX and Unilever.
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#50 The Art Lover
Christopher Tsai is a deeply thoughtful growth investor. He became one of the foremost collectors of the works of Ai Weiwei, recognising their implicit value and deeply studying the artist. His concentrated portfolio reflects his attraction to growth stocks with Tesla his largest position. In our conversation, he explains why he believes Tesla has deep moats across multiple verticals; why he thinks many of the growth stocks in his portfolio have optically inflated valuations as they invest now to create future value; why the second largest position in his portfolio is QXO, with his father, also a famous investor, being one of Brad Jacobs’ original backers; and what he looks for in managers. I am trying to meet more growth investors to understand their strategy better. Christopher’s portfolio is too racy for me, at over a 60x P/E multiple on my estimates when we recorded and probably higher today, but he makes an interesting case for holding long-term compounders.
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#49 The $50bn Man
David Samra has been in the investment business for over 30years. He specialises in international value and has beaten his index by over 4% pa for over 20 years, in a period when traditional value has been doing poorly. That may be why his fund, which has been closed to new investors for most of the last 14 years, has reached $50bn. In this conversation David explains his focus on four factors: owning good companies, buying them at a discount of at least 30% to intrinsic value, and ensuring they have excellent management and a strong balance sheet.And he discusses several of his stocks, sharing some impressively detailed knowledge.
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#48 The Independent Thinker
Dave Iben is the founder and CIO of Kopernik GlobalInvestors, a $6bn global value investment shop which prides itself on independent thought and is comfortable with contrarian positions.Steve invited Dave on the podcast because at a recent NewYork conference, Dave was cheerleading that value was back, and Steve wanted to discuss the rationale for his enthusiasm, given value’s massive underperformance in the last 15 years. Luckily Dave was spending the summer in London looking for cheap UK stocks, and they could record in person.
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#47 The Relentless Improver
Gary Channon is one of the UK’s better known valueinvestors. He runs a value fund, a closed-end fund and a private equity vehicle. He runs a highly concentrated portfolio. The top 5 positions are over 50%, and he holds no more than 15 stocks. I asked him on the podcast because he is really thoughtful about his process – he only buys stocks selling for <50% of intrinsic value, and if he can monitor the business performance independently of the company's communications. He is then prepared to hold them for extended periods, as long as they remain cheap.His framework for evaluating a stock includes parameterslike the depth of work completed and confidence levels, he has instructed his entire research team to become AI experts and he has already seen significant benefits; he thinks AI means sellside analysts will be more or less gone in twoyears; and we talked about his techniques for interviewing management which include spending 4-6 hours preparing for a 1 hour meeting.
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