Mr. Cannon: Over the past decade, Texas First Investment Management Company has been one of the top ranked value equity managers in the country. We are ranked Number 1 in the country among all value equity separate account managers for the five-year period ending June 30, 2009. The rankings were done by Morningstar, and published in Pensions & Investments Magazine in their Top Performing Managers article August 24, 2009. The universe there was all equity value managers: large-cap, mid-cap, small-cap and all-cap. We are also ranked the Number 1 mid-cap value manager over that same five-year period ending in June 2009. Our mid-cap value product is known as the Select Value Portfolio.
In terms of small-cap, our Small Cap Opportunity portfolio is rated the Number 1 small-cap value equity portfolio in the country for the one-year period ending June 30, 2009 and that is among all separate account managers. That ranking, again, was done by Morningstar for the Pensions & Investments Magazine article.
We are long-term value managers. We have an emphasis on risk limitation and industry-diversified portfolios. Investment decisions are based on bottom-up, in-depth fundamental research.
TWST: What is your definition of value? What are the valuation metrics that you look for in these mid and small-cap stocks?
Mr. Cannon: We believe that if you are a value manager, it is very important to buy stocks that are down for some reason and determine if there is a good reason the stock price should recover. The key is not just to find value stocks, but value stocks where the market has not realized their potential for fundamental improvement or stock price appreciation. We are true deep value managers, so we focus on companies that are at the lower end of their one, three and/or five-year price ranges.
Tickers included in this excerpt: CE, CGX, DDS, FDP, FOR, TIN, TSO, VLO, WFMI
For more information call (212) 952 7433. The Wall Street Transcript does not endorse any of the comments made by interviewees, and does not make stock recommendations.