Companies With Predictable And Consistent Earnings.
We like to bet with companies that have a predictable stream of earnings; operating in sectors that have a tailwind behind them.
The focus would be in identifying the next big trend by buying companies from sectors that are expanding rather than betting in a company which is growing in isolation.
We like to focus on sector leaders.
Scalable Businesses.
The business has to be scalable in terms of both value and volume growth.
As an investor we should be able to assume that the entire scale of operations can be ramped up multiple times from what is presently being done.
Growth
The business has to be scalable in terms of both value and volume growth.
As an investor we should be able to assume that the entire scale of operations can be ramped up multiple times from what is presently being done.
Return On Equity
Growth with high ROE is a potent combination. A high ROE indicates that the growth can be self sustaining without repeated capital dilutions.
Moreover, the ROE also indicates the level of efficiency with which the business is being.
Management
We don’t partner crooks no matter how remunerative the commercials might seem. However, both the management and business dynamics are important for an investor to make money.
Small Companies
Even though big isn’t ugly for us small does remain beautiful. Though an entire portfolio cannot be set up based on small caps the underlying objective would be to focus on smaller capitalized companies.
Cash Flow
High growth with free cash flow is desired but isn’t the only yardstick on which investments will be based.
The differentiating factor between a free cash and a negative cash flow company is the urgency with which an investor has to exit the stock once growth slows down.
Negative cash flow companies need immediate attention during adverse times whereas for free cash flow companies the reaction time could be a little longer.
Dividend Payout
We like to see dividends as a statement of intent and not for the cash that comes into our bank account.
Dividends and taxes are compulsory payments and indicates that profits are for real because no one pays real cash on fake profits
High Growth
High growth with free cash flow is desired but isn’t the only yardstick on which investments will be based.
The differentiating factor between a free cash and a negative cash flow company is the urgency with which an investor has to exit the stock once growth slows down.
Negative cash flow companies need immediate attention during adverse times whereas for free cash flow companies the reaction time could be a little longer.
We like to bet with companies that have a predictable stream of earnings; operating in sectors that have a tailwind behind them.
The focus would be in identifying the next big trend by buying companies from sectors that are expanding rather than betting in a company which is growing in isolation.
We like to focus on sector leaders.
The business has to be scalable in terms of both value and volume growth.
As an investor we should be able to assume that the entire scale of operations can be ramped up multiple times from what is presently being done.
A stock that grows at above average rates is like a child who comes first in class – he always gets what he wants. We focus on companies that can deliver above average earnings growth.
Growth with high ROE is a potent combination. A high ROE indicates that the growth can be self sustaining without repeated capital dilutions.
Moreover, the ROE also indicates the level of efficiency with which the business is being.
We don’t partner crooks no matter how remunerative the commercials might seem. However, both the management and business dynamics are important for an investor to make money.
Even though big isn’t ugly for us small does remain beautiful. Though an entire portfolio cannot be set up based on small caps the underlying objective would be to focus on smaller capitalized companies.
High growth with free cash flow is desired but isn’t the only yardstick on which investments will be based.
The differentiating factor between a free cash and a negative cash flow company is the urgency with which an investor has to exit the stock once growth slows down.
Negative cash flow companies need immediate attention during adverse times whereas for free cash flow companies the reaction time could be a little longer.
We like to see dividends as a statement of intent and not for the cash that comes into our bank account.
Dividends and taxes are compulsory payments and indicates that profits are for real because no one pays real cash on fake profits
High growth with free cash flow is desired but isn’t the only yardstick on which investments will be based.
The differentiating factor between a free cash and a negative cash flow company is the urgency with which an investor has to exit the stock once growth slows down.
Negative cash flow companies need immediate attention during adverse times whereas for free cash flow companies the reaction time could be a little longer.
Pecuniary's Investment Philosophy
At Pecuniary core is its Unique Philosophy of catching large trends in the Market. We are not interested in 10-20% up moves; instead look at buying companies that can give our clients multiple time (multibagger) returns. Our Niche lies in buying great Midcap companies which are often ignored by the Analyst Community.
History has shown that Wealth is Created by following the below rules
- Buy and Rotate Strategy beats Buy and Hold strategy.
- Every Bull Market has a Different leader; we find the leader in every bull market and stick to it.
- There is No Bull Market without Earnings Growth; we always buy sectors with high expected sustainable growth of more than 20% for next 3-5 years.
- Winners of Previous Bull Market will not lead the next bull market.
- We only buy companies that are making 52 week Highs, rather than new 52 week lows.
- The more market believes in the longevity of growth, the more valuations the stock get. Longevity is often the mispriced portion in Capital markets.
What's our Buying Strategy?
- Can grow 25%+ for long periods of time
- Can generate High Return of Capital Employed
- Smart and Ethical Management Team
- Competitive Advantage over competitors (Moat)
- Low on Leverage
- Reasonable Valuations
- Free Cash Flow Generator
Why Sector Rotation?
In our historical research, we found out that in an Overall Bull Market 7 Sectors do well and 3 Sectors Underperform, whereas in an Overall Bear market, 3 Sectors do well and 7 Sectors Underperform. There has always been a bull market in atleast 3 sector in the market caused due to innovation, change in macroeconomic activity, change in Government regulation etc.
What is our Selling Strategy?
We are not traders. We recommend an investment only if we believe the stock can atleast double in next 12-18 months.
We sell only if one of these things happens
- Better Investment Opportunity
- Story no longer Holds True
- Extremely Overvalued
- Long Term Breakdown in Stock, Sector or Market.
SIP CALCULATOR
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