UBP’s Swiss & Global Equity strategies are managed within the same investment team based in Geneva and following the same investment approach. As Swiss companies tend to be operational on a global scale, it is important to have a worldwide vision and expertise of the global market’s competitive structure when managing Swiss equity.
The Swiss and US equity markets offer the highest levels of Cash Flow Returns on Investment (CFROI)* for equity markets. CFROI is the financial measure which best enables an investor to gauge a company’s value-creation ability. With an investment framework based on companies’ CFROI lifecyles in place since 2006, UBP’s Swiss and Global Equity investment team focuses on attractively valued opportunities. They build convictions through bottom-up analysis of companies and their environment, incorporating strict environmental, social and governance (ESG) criteria into the process.
The Swiss and US equity markets offer the highest levels of Cash Flow Returns on Investment (CFROI)* for equity markets. CFROI is the financial measure which best enables an investor to gauge the value creation ability of a company. The Swiss and Global Equity investment team seeks undervalued companies along the company’s CFROI life cycle, building conviction through bottom-up analysis of companies and their environment.
*Concept of the CFROI life cycle
During a typical company’s life, its business generates varying levels of cash flow return on investment (CFROI) reflecting its stage of development: growth, maturity or decline. While superior CFROIs tend to fade down to the Cost of Capital (CoC) as value creation attracts competition, inferior returns may “fade up” to the CoC as a result of restructuring or competitors exiting the market. The team seeks to identify companies with consistent, superior CFROIs that steadily create value over the long term which is not yet discounted by the market. The team also looks for turnaround stories that are undervalued and for companies experiencing a phase of accelerating growth that may not yet be fully appreciated in terms of the magnitude and duration of the widening positive spread between CFROI and CoC.
