What is 'Fundamental' research?
Fundamental research is heavily focused on gathering and analysing first-hand information with the ultimate aim of determining whether a company's earnings growth is under or over-estimated by the market. To assess this, it's critical we understand the specific share price drivers and what the rest of the market expects the earnings to be. We then compare this against our own perspective and outlook on the company.
To gather this research, interviewing company management and utilising industry contacts are an essential part of our activity. We gather this information via several hundred company visits each year, across both Australia and globally. Each of our analysts spends time out of the office getting a first-hand look at each business and evaluating the factors which impact them.
What is 'Quantitative' research?
Quantitative factors on the other hand, provide a different perspective in identifying companies where the market is under or over estimating earnings potential. We use six specific factors which have each been comprehensively tested with proven effectiveness in uncovering unexpected earnings growth.
These factors cover all areas of a company's financial report, such as profit & loss, cashflow and balance sheet statements and can be broadly grouped into momentum and quality factors. The wide range of factors aims to bring valuable diversification to our research.