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Philosophy

Turtle Creek’s investment philosophy has been consistently described as bottom-up, cash flow oriented, involved, conservative, and long-term.

  1. Bottom up

    • We are 100% bottom-up investors. Given our backgrounds as private equity investors, we believe that we can use our rigorous analytical framework in concert with our willingness to become involved with the companies in which we invest, to exploit inefficiencies more effectively than investors who undertake market or economic forecasting.

  2. Cash Flow Oriented

    • As former private equity investors, we believe in the analytical rigour of discounted cashflow modeling on a company-by-company basis, preferring to invest, all else being equal, where discounts to our view of value – intrinsic value – are greatest. In a “contrarian” fashion, we believe in scaling-down exposure to companies which become market darlings, and scaling-up exposure where traded prices are pushed low and discounts to intrinsic value are pushed high.

  3. Involved

    • We believe companies often benefit from the views of objective, external shareholders. Shareholder involvement is a key tenet of our approach, and one that we apply on a selective basis.

  4. Conservative

    • We are conservative investors – and we are investing all of our liquid net worth in our funds. We believe that company-specific risk is mitigated through (1) prudently seeking low operating risk, (2) explicitly acknowledging financial leverage, and (3) investing a focused portfolio which leverages our involvement, our research and our knowledge. Allocating capital outside the arena where one enjoys deep knowledge is not investing, it is speculation.

  5. Long-term

    • We have imported the long-term view from our private equity backgrounds. We believe that a company’s fundamentals are recognized by the market over time.