Video Transcript
The real opportunities in finding alpha are from understanding individual businesses.
Chris Ehley, CFA, Partner
Research Analyst
U.S. Growth & Core Equity Team
Two years ago, we did a deep dive into value-based care, a fast-growing area within the healthcare sector. Our process was not only to study the industry itself and the various companies that were emerging in the space, but it was to really dig deep and understand the unit economics of these various business models, to try and understand whether or not these companies were capable of creating value for the healthcare system as a whole, that could justify their own profits and returns. I think that our differentiated approach to evaluating the sector enabled us to take our analysis to a level of granularity that enabled us to ask the right questions, and ultimately it helped us to avoid investing in various companies within the space that have since fallen on hard times.
Renée Scott, CFA
Research Associate
U.S. Growth & Core Equity Team
Rigorous fundamental analysis is the cornerstone of our investment process. We research multiple angles of a company. We take the time to understand the nuances of the business model, the various end markets, and the competitive landscape, and then we distill all that down to our estimate of earnings and free cash flows over our investment horizon. Our deep company knowledge is the foundation for our potential alpha generation.
Nate Mendes, CFA
Research Analyst
U.S. Growth & Core Equity Team
Disclosure
The views and opinions expressed herein are those of the speaker(s) as of the date of publication, are subject to change without notice as economic and market conditions dictate, and may not reflect the views and opinions of other investment teams within William Blair. Factual information has been obtained from sources we believe to be reliable, but its accuracy, completeness, or interpretation cannot be guaranteed. This material may include estimates, outlooks, projections, and other forward-looking statements. Due to a variety of factors, actual events may differ significantly from those presented. This video has been provided for informational purposes only and should not be considered as investment advice or a recommendation of any particular strategy or investment product, or as an offer to buy or sell any securities or related financial instruments in any jurisdiction. Investment advice and recommendations can be provided only after careful consideration of an investor’s objectives, guidelines, and restrictions.