LanderNorth applies private equity-like due diligence to small public companies that are substantially overlooked and undervalued by institutional investors. The investment team utilizes a bottom-up fundamental approach to valuation and employs a proprietary screening methodology in tandem with external research in identifying the most attractive investment opportunities.

Understanding a company’s core business is critical to the investment decision. LanderNorth puts a high level of focus on making both a qualitative and quantitative decision on companies prior to any investment. As in private equity investing, the portfolio team meets regularly with the senior management group of companies being considered for investment and utilizes additional analytical external resources to identify those companies with the greatest potential for growth. LanderNorth utilizes a GARP style of investing and will not override core valuation modeling in favor of momentum.

LanderNorth’s process begins with a universe of 4000 small cap companies with market cap less than $200 M to $2Bil. Utilizing a series of proprietary screens, fundamental analysis is performed which results in a focus list of 100 to 125 names, all of which are attractive relative to earnings and revenue growth, debt ratios, and return on equity.

Qualitative reviews are conducted by the team with a focus on the company’s business and the quality of its management team. LanderNorth does not invest in startups or turnarounds. Rather, only companies that are industry leaders with proven performance records are considered for investment. The result of this qualitative analysis is a short list of 50 to 70 names suitable for inclusion in the portfolio.

Finally, a proprietary valuation model is used to determine price targets based on a series of metrics. Companies are added to the portfolio only if the management team determines the current price to be attractive relative to these valuations. Valuations are not ignored in favor of sector diversification.

In order to control risks, LanderNorth adheres to a well defined sell discipline. There is no hesitation to lock in gains as appropriate given certain valuation triggers. Changes in business fundamentals, industry, or company specific management can result in a sales based on the investment teams on-going due diligence.