Going back to basics, the price of a stock is determined by two key factors:
- The future cash flows of that company; and
- The price investors are willing to pay for it.
At LGM, we do not categorize ourselves in the value or growth camp; our goal is simply to grow the capital we are entrusted with (yours and ours) as sustainably as possible by investing in high-quality companies. In this quarter/year end, we want to walk through some of our considerations around investing and how we see our opportunity set evolving. We will finish with our annual ‘lessons learnt’ section, this time talking broadly about errors of omission while specifically highlighting two names that have been brought up by both current and potential investors.