In today’s information driven markets, equity prices normally reflect reasonable valuations based on the long term fundamentals of issuing companies. There are, however, often situations in which a security can be temporarily mispriced relative to the issuing company’s prospects for the future. Understanding a company’s long term fundamentals and prospects – and their influence on a security’s value today – is the key to successful fundamental value investing. At Palouse Capital, our seasoned team of investment professionals applies a fundamental value approach to every decision we make on behalf of our clients. We strive to understand the long term prospects of each company we analyze. If we believe that the current price of a security is materially lower than a reasonable fundamentally driven estimate of long term value, we consider the security for purchase. When we believe a current portfolio holding has reached our current estimate of value we consider the security for sale.
