Investment Philosophy

Our firm believes that wealth is created by using extremes of pessimism to enter into ownership of great companies. Our philosophy is based on the premise that valuation, high quality, low turnover and long duration lead to statistically significant absolute and relative investment returns.

Our focus at Smead Capital Management (SCM) is the acquisition and ownership of companies meeting our proprietary eight criteria. The eight criteria drives us toward high quality, but demands that purchases are initiated when these companies are found in the lowest valuation areas of the US stock market. This focus leads us to financially strong companies which have non-cyclical characteristics. This lack of cyclicality and impressive financial strength allows long holding periods and low turnover. We subscribe to the academic studies that show these are all variables that add to portfolio returns and relative outperformance.

We believe our proprietary criteria and investment discipline leads to above average dividend growth, capital appreciation and low frictional costs. We also believe our valuation methodology preserves capital and keeps us away from popular investment modes.