May 6, 2025 | U.S. Value Equity
Our Value Approach
Speakers
Portfolio Manager
Head of the U.S. Value Equity Team, Portfolio Manager
Watch this video online:
https://youtu.be/CxoGohmPX6E?si=7mAx5YRktUifnuYx
Our value equity team explains its approach to value investing: not deep value, but high-quality value.
Transcript
Our team’s approach to value investing is not deep value, but high-quality value.
We’re looking for stocks that we think are industry leaders as evidenced by demonstrable characteristics, such as high returns on capital, barriers to entry, high margins.
And we’re trying to find these high-quality companies that are temporarily mispriced, for one reason or another. We’re trying to buy them at a discount to not only what we think their intrinsic value is, but also with a very limited downside.
When we approach valuation, we’re trying to buy companies that are undervalued on an absolute basis. So, we’re always trying to find companies that trade at a discount to the whole small-cap universe.
Beyond that, we’re really trying to triangulate three things.
One, we’re trying to buy companies that trade at a discount to other peer companies.
Two, we’re trying to think about, “Are we buying companies that are trading at a discount to private market values?”
But third, which is really the core of our rigor, is that for every company we’re looking at, we look at how the company’s traded on a 5-, 10-, 20-year basis on a number of valuation factors.
We talk about the quality of management. We talk about the quality of the operations. We talk about the moats. What are the specific advantages that allows that company to the sustain higher margins, higher returns that we’re looking for?
And so, if our investment thesis plays out, we want to be buying the company at the lower end of its historical trading range.
Filmed July 2021
The views and opinions expressed herein are those of the speaker(s) as of the date of publication, are subject to change without notice as economic and market conditions dictate, and may not reflect the views and opinions of other investment teams within William Blair. Factual information has been obtained from sources we believe to be reliable, but its accuracy, completeness, or interpretation cannot be guaranteed. This material may include estimates, outlooks, projections, and other forward-looking statements. Due to a variety of factors, actual events may differ significantly from those presented. This video has been provided for informational purposes only and should not be considered as investment advice or a recommendation of any particular strategy or investment product, or as an offer to buy or sell any securities or related financial instruments in any jurisdiction. Investment advice and recommendations can be provided only after careful consideration of an investor’s objectives, guidelines, and restrictions. Investing involves risks, including the possible loss of principal. Past performance is not indicative of future results.
Copyright © 2025 William Blair. “William Blair” refers to William Blair Investment Management, LLC. William Blair is a registered trademark of William Blair & Company, L.L.C.
