“You must thoroughly analyze a company, and the soundness of its underlying businesses, before you buy its stock; you must deliberately protect yourself against serious losses; you must aspire to “adequate,” not extraordinary, performance.” ― Benjamin Graham, The Intelligent Investor

 Our  investment process encompasses three key steps: 

1) identifying  screening prospects, 2) determining our own estimate of intrinsic value  for the business using the industry's valuation metrics 3) buying the  business only if there is sufficient double digit discount of price to  intrinsic value.

Screening:  The investment process begins by narrowing our investment universe by  screening for stocks with a market cap greater than $1 billion; pricing  at or near the stock’s 52-week low, and attractive valuation metrics.  The objective is to identify a pool of equities with attractive  characteristics to focus our fundamental research on the most compelling  candidates with the high probability of success.  

Valuation:  The next step in the investment process is to conduct fundamental  research on selected companies to assess the attractiveness of an  individual company from a business owner perspective. Fundamental  research occupies the bulk of our effort and drives final security  selection. The fundamental  investigation process begins with an evaluation of company financials,  competitive position, management, cash flow, and historic trends. The  company’s fair intrinsic value is then determined through the  application of several valuation methodologies and industry metrics that  include discounted cash flow analysis, sum-of-the-parts analysis,  return on capital analysis, and multiples analysis.  

Purchase: If  the firm’s research shows that a company can be purchased at a  sufficient price discount to our calculated fair intrinsic value and  offers clear catalysts for appreciation, its stock is considered for  purchase by MVP's investment team which meets weekly to review  portfolios and evaluate new investment candidates. After rigorous debate  and exchange of ideas, the investment team sets final buy and sell  targets for a company under consideration and makes the purchase if  deemed appropriate. 

Consistent  with MVP’s investment process, the company employs a bottom-up sell  discipline that includes selling when a stock reaches its estimated  intrinsic value, or all catalysts are realized, or the company violates  its investment thesis, or if a stock is superseded by an opportunity  that offers greater return potential. MVP’s value investment process described above is applied across all three of MVP’s value investment strategies.