Egor N. Rybakov, CFA, is Senior Vice President and Global Equity Portfolio Manager for RMB Capital, a Chicago-based independent financial services firm with more than $8.1 billion in assets under management. In his exclusive interview with the Wall Street Transcript, Mr. Rybakov reveals in detail the investment process he has honed for the past two decades — screening the universe of international equities to uncover mispriced quality companies expected to create long-term value.
Currently, the asset manager is looking far and wide for undervalued stock listings: “…the markets are fairly valued, and in order to discover investment candidates with long-term positive risk/reward, one has to explore companies toward the lower-cap spectrum of the market. That is where we have a competitive edge through our philosophy and process, which are different when compared to those generally offered by the rest of the managers.”
Mr. Rybakov is very focused on being a business owner, rather than a stock holder. “Rather than looking at a company and trying to predict what it will do in any given quarter or year, we analyze the business model trying to understand what it is capable of delivering in terms of cash flows, returns and growth over the long term. From that point of view, we allow ourselves to focus on discovering genuinely robust business models with strong competitive moats, strong industry positioning and management teams whose interests are well-aligned with the interests of shareholders — and, ultimately, to buy such models when they are underappreciated.”
An example of a recent investment decision is Skellerup Holdings (NZE:SKL). “This is a company that is domiciled in Auckland, New Zealand, and it has roughly $250 million U.S.-dollar-equivalent market cap. Now, while Axactor, Asante and most of our holdings have been discovered by our investment screens where we search the financial databases for the qualitative and evaluation parameters of our proprietary approach, Skellerup came to our attention as a part of the competitive analysis of one of our other holdings, Avon Rubber Plc (LON:AVON), which is a U.K. company. Skellerup specializes in the manufacturing of rubber and foam products.”
To review the details on the Skellerup investment and review of all of Mr. Rybakov’s top holdings, read the entire interview at the Wall Street Transcript.