Friess Associates LLC
Friess Associates manages growth-equity portfolios that span the market-cap spectrum. The firm’s time-tested investment strategy emphasizes individual-company fundamentals as the primary influence on stock prices. Exhaustive, company-by-company research is the key to the Friess approach.
Friess employees believe in what we do. Employee-owned, our interests are aligned with the investors we serve. Friess teammates, past and present, embrace our time-tested investment approach to achieve their own long-term financial goals. Founded in 1974, Friess Associates operates from offices in Greenville, Delaware, and Jackson Hole, Wyoming.
Rapid Growth at Reasonable Prices
Our strategy is based on the straightforward premise that earnings drive stock prices. While macro factors can move stocks for fleeting periods, we believe individual-company fundamentals are the primary influence on stocks over the long haul.
We aim to isolate companies poised to deliver rapid year-over-year earnings growth that also enjoy good prospects to exceed consensus earnings expectations. Since we try to own companies before their success is fully reflected in their stock prices, we focus our efforts on isolating rapidly growing companies that also sell at reasonable multiples of earnings estimates.
Beyond growth prospects and valuation, we emphasize companies with proven management teams, sound fundamentals and solid balance sheets, including low debt and high returns on equity. We also demand a timetable of near-term growth catalysts, such as a new product launch, management team or market opportunity, likely to drive earnings in excess of consensus expectations.
Portfolios Built to Outperform Indexes, Not Mimic Them
Friess Associates is an active investment manager, meaning that we make investment decisions based on the information that we gather through bottom-up research. We continuously investigate existing holdings and new opportunities, with our findings leading our efforts to make the portfolios we manage collections of our best ideas.
Since an existing holding already falls into the “best idea” category, a researcher proposing a new opportunity needs to make a convincing case that the new idea is great, or at least good enough to show more promise than the existing holding it would replace. We call the process “forced displacement,” and we describe it as replacing good ideas with great ones.
We’ll be the first to admit that not every new idea we come up with is great. Still, consistently striving to uncover great opportunities helps us maintain our commitment to managing portfolios of our best ideas. Our researchers know that if a company they pursue doesn’t show great potential, they should look elsewhere until they find a company that does.
We use our company-level research findings to build portfolios one company at a time without regard to the composition of any particular index. Maintaining an individual-company focus typically results in portfolios with low correlations to benchmarks. Our goal is to outperform the indexes, not mimic them.
Research-Driven Process
Exhaustive research is the key to our earnings-driven approach. We develop individualized earnings expectations for every existing holding and target company by keeping in constant contact with executives and others who manage, interact with and/or work in the same industry as these companies.
We use the term “trade check” to describe the interviews we conduct with company management teams, customers, competitors and suppliers. Trade checks include in-person company visits, trade shows, user conferences and discussions via phone.
The Friess research team conducts scores of trade checks as part of an ongoing effort to glean insights on existing and potential holdings. Trade checks represent one of our most fruitful methods of idea generation, with research legwork often uncovering promising opportunities outside of the initial direction of our investigation.
Commitment to Clients
Investors who choose to entrust their assets to our stewardship pay us a great compliment. We strive to deliver results that reward their confidence in us and to serve them at the high levels they deserve.
Friess Associates manages the Friess Small Cap Growth Fund (SCGFX) and serves as sub-advisor to the all-cap AMG Managers Brandywine Fund (BRWIX), the large-cap AMG Managers Brandywine Blue Fund (BLUEX) and the Greenwich Friess Long/Short Fund. The firm also manages separate growth portfolios focused on the micro-, small- and all-cap categories.
To learn more about Friess and our research-driven investment approach, please contact Managing Partner Joe Fields at (302) 656-3017 or jfields@friess.com.
Email: jfields@friess.com
Website: Friess.com