Skip to Content

Investment Philosophy

Bridgeport follows a bottom-up, deep-value oriented approach to investing. This involves rigorously researching individual companies to understand their underlying economics and future business prospects. We focus on generating superior absolute returns over the long term by analyzing the intrinsic value of a company and purchasing its securities when they are priced substantially below this value. In selecting investments for ourselves and our clients, we are guided by the following principles:

  • We invest for the long term and avoid focusing on short term trends, whether such trends are positive or negative.
  • While we rigorously research the companies in which we invest, we make our investment decisions independently of others in the marketplace.
  • We seek to minimize investment risk by investing in businesses with understandable and sustainable business models.
  • We view ourselves as stakeholders in the businesses in which we invest not just holders of securities.
  • We invite open and frequent dialogue with the management of the companies in which we invest.

Equities
 
Bridgeport favours equity investments in companies which:

  • Generate significant recurring revenue or repeat customer purchases
  • Are not susceptible to rapid technological change
  • Exhibit high barriers to entry through dominant market positions, branded products, significant economies of scale or long term customer contracts, etc.
  • Employ skilled, experienced and prudent management who are effective allocators of capital
  • From a financial perspective, Bridgeport invests in companies which generate above average operating profit margins and returns on invested capital and exhibit superior growth in annual operating profit, earnings per share and free cash flow.

We seek to invest in the shares of companies of companies which meet our criteria when they can purchases at depressed prices relative to their underlying profit, operating cash flow and/or book value.
 
Fixed Income
 
Our philosophy with respect to investing in fixed income securities (i.e. bonds and similar instruments) is to seek investment opportunities which offer superior risk-adjusted returns. We focus on the underlying fundamentals of the borrower and its credit worthiness. Our approach relies to a lesser extent on forecasting future interest rate levels.



.