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Borsgade
In a recent interview, François Rochon discusses his approach to identifying exceptional businesses by combining quantitative and qualitative analysis. He starts by examining historical performance metrics such as return on capital, profit margins, debt levels, and the quality of earnings to identify strong companies.
François emphasizes that past performance alone is not a reliable predictor of future success. He evaluates whether the key drivers of past success, such as competitive advantages and durable moats, remain robust.
He also underscores the pivotal role of management in sustaining strong performance, particularly in areas like capital allocation, product innovation, acquisitions, dividends, and share buybacks. This comprehensive strategy helps ensure a company’s potential for delivering outstanding long-term results.
We want to own great businesses, and the best way to identify them is to look at their past numbers, their past performance. […] But also, we realize the limitations of an approach that focuses too much on the past because past numbers only reward past shareholders. When you buy shares today or you stay a shareholder in a company, it’s the future that will decide whether you get rewarded or not.
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