Art of Boring Mawer Investment Management Ltd.

Portfolio Manager Karan Phadke discusses his views on the global markets and the performance of the global small-cap portfolio. He illustrates how businesses are adapting to and utilizing artificial intelligence (AI), highlighting the difference between the value-added reseller and IT consultant business models. Two portfolio holdings, CBIZ and Convatec, are discussed to demonstrate the team's focus on well-run, resilient companies that are trading at reasonable valuations.

Key points from this episode:
The U.S. remains a strong outperformer, while Europe continues to see more sluggish growth. Current portfolio strengths include resilient U.S. companies, particularly in the professional employer organization (PEO) space with companies that provide outsourced HR functions. AI is impacting businesses in three main areas: hardware, software, and services. The team focuses on services, which is comprised of companies that help their clients acquire and integrate the hardware and software to use AI effectively. Regarding generative AI, there's still a very heavy lift involved at the onset to get the data clean and ready to use. When looking at the strategy from the top down, the team seeks out resilient businesses trading at reasonable valuations that are well-run with strong managers who are reinvesting capital intelligently. CBIZ exemplifies the strategy's focus on well-run companies with recurring business models while Convatec represents a business with solid management and long-term growth potential. Host: Andrew Johnson, CFA, Institutional Portfolio Manager
Guest: Karan Phadke, CFA, Portfolio Manager
For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/navigating-global-small-caps-in-an-ai-transformative-world-ep157
This episode is available for download anywhere you get your podcasts.
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Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.Follow us on social:
Twitter - https://www.twitter.com/Mawer_Invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

In this episode, Portfolio Manager Colin Wong shares strategic insights on disruptive technologies and recent adjustments in the U.S. equity portfolio. Colin discusses how his team navigates market exuberance, consensus risks, and economic ebbs and flows with a focus on resilient returns. Through compelling examples, Colin provides actionable insights on benefitting from innovation without betting the farm on a single theme.

Key points from this episode:
The three main sources of stock market return are earnings per share growth, multiple expansion, and dividends. Similar to the Internet in the late 90s/early 2000s, artificial intelligence (AI) has the potential to transform almost every industry and sector. However, some companies are currently only using AI for various smaller tasks, such as answering simple customer queries, while others have fully embedded AI into their products. The U.S. equity team invests in companies with profitable existing businesses that are also investing in the future, namely AI. An influx of infrastructure spending in the U.S. not only provides upside to the businesses in the portfolio but also serves as a significant source of downside protection. Intuit and Nike are examples of Mawer’s investment philosophy at work, one of which was recently exited and the other recently purchased. Host: Andrew Johnson, CFA, Institutional Portfolio Manager
Guest: Colin Wong, CFA, Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/u-s-equity-capitalizing-on-innovation-and-protecting-against-pitfalls-ep156
This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at www.mawer.com.

Follow us on social:
Twitter - https://www.twitter.com/Mawer_Invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

Portfolio Manager Wen Cheong debunks the perceived challenges of investing in the emerging market space, highlighting his team’s concentrated approach and candour. He details how his focus on best-in-class management and passion for identifying attractive valuations has powered returns.
 
Key points from this episode:
 
• Small-cap companies are a pond with fewer rocks; opportunities can be found in steady, established businesses with competitive advantages.
• The slump in semiconductor demand in 2023 was primarily driven by a normalization in post-pandemic demand and macro challenges leading to an inventory de-stocking cycle.
• The EM team makes decisions for the portfolio entirely on a bottom-up basis with a slight macro overlay.
• Even in areas with geopolitical uncertainty, opportunities can be found in well-run, high-quality companies with attractive valuations.
• The emerging markets space remains full of diverse opportunities for those willing to do the deep dive.
 
Host: Rob Campbell, CFA, Institutional Portfolio Manager
Guest: Wen Cheong, CFA, Portfolio Manager
 
For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/fishing-in-less-crowded-ponds-identifying-opportunities-in-emerging-markets-ep155
This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. 
 
Visit Mawer at https://www.mawer.com. 
 
Follow us on social: 
Twitter - https://www.twitter.com/Mawer_Invest 
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/
 

Building on his conversation in Episode 153, Portfolio Manager Samir Taghiyev takes a deep dive into the mental models and frameworks that Mawer uses to evaluate company management teams, particularly within the small-cap space. Using both personal and financial examples, he illustrates the benefit of exploration and exploitation, striking a balance between focus and curiosity, and identifying opportunities on the S curve of the corporate lifecycle.

Key points from this episode:
Company management can be evaluated by determining if they are growing revenues while controlling costs and risks. This can be combined with other frameworks to create a comprehensive picture. The exploration vs. exploitation framework can be used to evaluate how well management balances focus with curiosity. There are four phases in the S curve of the corporate lifecycle—startup, growth, maturity, and decline. Mawer focuses on companies in the middle two phases, with Trisura and TerraVest provided as examples. Incrementalism is very important when it comes to exploration vs. exploitation because it strikes a key balance between spending to de-risk and learning. Companies can either drive growth organically, often through the introduction of new products, or inorganically through acquisitions. Using the “look back” and “trust but verify” processes, the small-cap team leverages their historical notes and third-party information to improve their verification of management claims. Host: Kevin Minas, CFA, Institutional Portfolio Manager
Guest: Samir Taghiyev, CFA, Portfolio Manager
For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/

This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter - https://www.twitter.com/Mawer_Invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

Portfolio Manager Samir Taghiyev discusses the current landscape of the Canadian small-cap space through the lens of the “Mr. Market” narrative and crowd-driven sentiments. Using Converge Technology Solutions as an example, Taghiyev sheds light on his team’s due diligence process and how they find opportunities by tuning out the noise.
Key points from this episode:
The mood of the markets can change very quickly, highlighting the importance of due diligence Investors should be aware of market narratives but not get caught up in them Diligence on business, management, and valuation is key to finding opportunities created by delayed market reactions Small caps may see more exaggerated dynamics due to retail investor involvement Host: Kevin Minas, CFA, Institutional Portfolio Manager
Guest: Samir Taghiyev, CFA, Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/moody-mr-market-finding-opportunities-in-the-canadian-small-cap-space-amid-changing-market-psychology-ep153

This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter - https://www.twitter.com/Mawer_Invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

As markets continue on a dynamic trend, fixed income portfolio manager Crista Caughlin discusses the economy and factors that drove markets in the first quarter of 2024. In addition, the reemergence of a more typical correlation pattern between stocks and bonds, getting central banks off the sidelines, and the concern that markets may be being too complacent.

Key points from this episode:
Global growth improving, inflation moderating, and earnings relatively strong In Canada, growth has improved although consumption remains weak when compared to the U.S. Moving with caution: strong data has begun to cause central banks to be cautious around timing of interest rate cuts—they want to be confident higher inflation is in the rear view mirror Strong equity markets—a continuation of the 2023 technology-focused businesses doing particularly well, especially if they have a tie in to AI or semiconductors Too much complacency? We may not have seen the full impact of higher interest rates, and you can see that in some areas we are seeing continued pressure (e.g., real estate, mortgage arrears, loan delinquencies) Host: Kevin Minas, CFA, Institutional Portfolio Manager
Guests: Crista Caughlin, CFA, Mawer Portfolio Manager
For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/quarterly-update-q1-2024-ep152
This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter -  / mawer_invest
LinkedIn -   / mawer-investment-management