INVESTMENT OBJECTIVES
- Continuation of OUTSTANDING LONG-TERM CAPITAL GAINS
- MINIMIZE RISK by using a proven CONSERVATIVE VALUE investment approach
- Use of DIVERSIFICATION among industries
STOCK SELECTION
Stock ideas are identified by two primary methods:
- Continuous review, monitoring and analysis of Texas-based and select U.S. corporations and their stocks.
- Proprietary computer database.
Key stock selection criteria:
- Low price / sustainable earnings.
- Low price / sustainable cash flow.
- Low price / adjusted book value.
- Low price / five-year growth rate.
- Stock price at lower end of one, three, five-year ranges.
- Potential catalysts to unleash value (potential acquisition target, stock buyback, corporate restructuring).
- Management strategies that are clearly committed to enhancing shareholder value in the near term.
- Companies whose stock prices have declined sharply because of near-term problems, but which have a good long-term outlook.
- Management that is buying – as opposed to selling – their company stock.
Stocks eliminated from consideration:
- Unclear accounting statements
- Unsustainable or hard-to-predict growth rates
- Unethical management
- Poor competitive position
Sell Criteria -Stocks may be sold when:
- Price objectives are achieved
- Fundamentals change
- More attractive alternatives are found
