Finding stocks that perform through the cycle: Munro Partners
March 5, 2019
Nick Griffin, Chief Investment Officer at Munro Partners, told Livewire that earnings growth will trump macro uncertainties “time after time”. Stocks that can grow consistently throughout the cycle will survive the volatility and come out stronger on the other side. He shares his simple three-rule process for identifying these stocks:
Start by looking for companies that address a large total addressable market (TAM). TAM is notoriously difficult to measure, so make sure you’re looking for genuinely huge markets to allow yourself a margin of error.
Find a company that has a strongly differentiated product or leadership position and only just starting to take market share – you need a very long runway for growth.
Make sure that management has the skills to execute on the plan.