6 min read | by Rich McCormick | I recently spent two weeks traveling in Japan, meeting with leaders across a range of industries, from banking to real estate to industrials to technology. Over the past several decades, our team has visited the country consistently, helping us find many “diamonds in the rough.” We have noted positive – albeit slow – developments across the corporate landscape, particularly over the past several years. Increasingly, I have heard investors speaking of enormous change underway in Japan, but my trip revealed a more nuanced story of continued incremental progress rather than radical change.
5 min read | The valuation case for international equities is among the most compelling we have seen in years, but this is only part of the story. The conventional wisdom is that non-US equities are cheap for good reason and that international stocks are either low-growth or high-risk, but fundamentals are stronger than many investors perceive. In this paper, we discuss the underappreciated case for investing in international markets, built upon several timely and compelling themes.
7 min read | by Robert Silgardo | Earlier this year, I spent a week in Taiwan and met with over 20 companies within the Asian technology supply chain [click here to read more]. Economic activity, day-to-day life, and sentiment among citizens and corporate executives are largely back to normal. Most COVID restrictions and policies have been lifted, but many locals (especially those in the service industry) still wear masks, and everyone is required to mask up on public transit (including the high-speed rail). Concerns about a potential Chinese invasion, slower-than-expected demand recovery, and ongoing talent shortages were topics of discussion during many meetings with company executives.
4 min read | An excellent article in the FT by Richard Bernstein offers great perspective and makes a case for the overdue broadening out of markets [click to read]. We concur and have written extensively on this issue from a different angle. Our CIO John Hock worked with Rich back in his Merrill Lynch days and always admired his character, intelligence, investment acumen, and common sense. Different perspectives, but shared conviction in how this plays out.
3 min read | by Glenn Cunningham | I recently traveled to Spartanburg, SC, one of the primary automotive manufacturing hubs in the United States, with over 500 auto-related companies employing more than 75,000 workers. Meetings with manufacturers, suppliers, and government officials provided insights into key themes shaping the auto industry: technological change, new sources of competition, and supply chain disruptions.
Alice Popescu, Portfolio Manager, participated in the Pension & Investments webinar entitled “Emerging Markets: A Resilient Outlook.” Topics covered include why EM allocations belong in institutional portfolios, the regions/countries representing the best investment opportunities in EM today, perspectives on China, the benefits of active management, and key considerations for investors considering EM. Click 'Read more' below to access the recording of the webinar. A copy of the P&I EM supplement is also available for download.
8 min read | by Rich McCormick and Elijah Crago | Investor pessimism on the ground in Brazil has reached an extreme relative to the past decade – but where negative sentiment exists, there may also be value. The return to power of a leftist president, anti-business rhetoric, and interest rates back at decade highs have turned many investors away altogether – resulting in some of the lowest valuations in the world. Upon returning from a recent two-week trip to Brazil, we are excited by the investment opportunities emerging in the country.
5 min read | by Geoff MacPhail | The application of technology in agriculture has the potential to transform farmers’ operations and generate tremendous growth opportunities for the companies driving innovation [click here to read more]. When you speak with farmers, you frequently hear “yield is everything.” This certainly rang true over the three days that I spent in Boone, Iowa at the Farm Progress Show last year.
In light of the significant developments in the US and European banking industry, we wanted to provide a brief update on our exposures, share some thoughts, and offer some issues to consider.
2 min read | by Glenn Cunningham | I recently attended the Industrial Manufacturing Technology Show (IMTS) in Chicago to gain further insight into the technology and industrial industry ecosystems. Discussions at the show reinforced a number of key themes that we have independently identified through our bottom-up research. Broadly speaking, these include the need for more automation due to skilled labor shortages, the costs and benefits of supply chain fragmentation, and the growing integration of technology across the industrial landscape.
