​Prime objective:  Outperform the benchmark S&P 500
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We analyze the stocks of publicly traded companies with one goal in mind: uncover equities whose market prices fall below our estimate of their intrinsic value.
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In theory, the strategy is straightforward. In practice, it’s rare to execute with consistency. We are searching for what Charlie Munger once called, “good companies at a wonderful price.”

As Warren Buffett puts it, all true investing is value investing — in essence, buying shares when they are undervalued relative to their intrinsic worth.​

PARTNER WITH US​


​HOW WE DIFFER
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Our success is built on yours — we only earn when our partners are already in profit.​

Call 708-288-2773 to learn about our investing approach and schedule a no-pressure partner presentation. 
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NORTHCOTT CAPITAL 

INVESTMENT STRATEGY
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  • Understand the business and how it makes money​
  • Confirm that the business has a durable, competitive advantage over its competitors
  • Confirm the business is run by competent, honest, shareholder-oriented management​
  • Perform in-depth financial analysis  
  • ​Patiently wait to purchase at a time when the business is “on sale” providing a comfortable “margin of safety”.​​

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​Over time, this disciplined approach is designed to deliver superior risk-adjusted returns compared to traditional investment strategies.

WE SEEK TO UNDERSTAND

THE MOOD OF THE MARKET


The stock market is made up of people — and people are emotional.

As a result, the market itself often reflects those emotions, swinging between fear and greed.
As Warren Buffett famously said, “Be fearful when others are greedy, and greedy when others are fearful.”

Benjamin Graham, considered the grandfather of value investing and Buffett’s mentor, personified the market as “Mr. Market,” a manic-depressive partner who will eagerly sell you stocks when prices are too low — and buy from you when they’re too high.​
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The trick is to know what mood he is in.

FOCUS 
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At Northcott Capital we recognize that a single stock represents an interest in a real company. This enables us to focus our time and attention on a company’s fundamentals, evaluate the business by assessing its operating cash flow, capital expenditures, tax provisions, competitive threats, future opportunities, competitive barriers to entry, and many other financial considerations. Price trends, volatility, and performance relative to other stocks or the stock market as a whole, is not our main concern.

Northcott Capital Management strives to:
  • Identify a company’s true fair market, intrinsic value
  • Forecast its future growth potential
  • Focus on purchasing the stock if or when it falls within our predetermined “Margin of Safety” purchase price
  • Understand that the stock price will eventually, in time reflect the true intrinsic value of the underlying business
​Peter Lynch, one of the most successful fund managers at Fidelity is famous for saying, “You need to know what you own and why you own it”. We recognize this. When we purchase a stock, we are investing in a business, not a speculative gamble on a piece of paper, but rather a percentage ownership of an actual business.

Our primary goals are capital preservation during market downturns and finding deep value with a contrarian bias.  We use event driven volatility and technical momentum indicators to invest in high-quality, well-run companies and at a price below intrinsic / fair market value insuring a clear margin of safety purchase price.

MISSION


To provide a trustworthy, reliable investment vehicle for smaller investors with limited capital or amounts much lower than traditional investment management firms would consider.

Northcott Capital offers the comfort of knowing our personal capital is invested alongside our partners with an “in this together”, investment club approach. We achieve this objective by investing in the same companies, and in the same amounts as our partners. This ensures our undivided attention to detail because our own personal financial interests are also at stake. Our pooled funds approach enables us to harness greater investment opportunities through the deployment of time-tested, proprietary investment strategies.

​PRINCIPLES ​

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  • ​Long term view, but tactically traded investments
  • Focused portfolio, but often hedged
  • Easy to understand, high quality businesses
  • Durable Intrinsic protection against competition
  • Management with integrity and talent
  • Strong balance sheets
  • Low to no debt​
  • Companies that do not need access to outside capital to survive an economic storm
  • Event driven, miss priced equities
  • ​Options Strategies​ ​​

​FUNDAMENTALS 

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The majority of the invested capital will be in a small number of equity positions, typically 15 or less.

Northcott Capital will seek to purchase equities at half the intrinsic value, based on a proprietary valuation methodology, with the expectation of long-term capital gains.

When proprietary technical indicators signal a major market direction shift, we will adjust the portfolio asset allocation between overweight equities to overweight cash.

We employ derivative option strategies to create cash flow, provide cost basis reduction and create advantageous entry and exit positions.

TALK TO US

(708) 288-2773

PROUDLY BASED

Chicago, Illinois

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