Why we are all value investors — from Albert Bridge Capital: Imagine two scenarios. Company A has a strong management team focused on increasing returns on invested capital. Current cash flows are €3bn a year. Top-line growth of 4% and EPS growth of 14% suggests even stronger cash flows down the road. The industry is stable and growing secularly, and Company A holds the number one position in all three of its key geographies; and yet the sell-side analysts are bearish, anchored to a stale accounting-short thesis. Company B also has a strong management team that is focused on increasing returns on invested capital. Current cash flows are €3bn a year. Top-line growth of 4% and EPS growth of 14% suggests even stronger cash flows down the road. The industry is stable and growing secularly, and Company B holds the number one position in all three of its key geographies; and yet the sell-side analysts are bearish, anchored to a stale accounting-short thesis. Company A is trading on a 2019...
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