Investment Philosophy and Process
Bridge City Capital's investment philosophy is: a focus on quality companies with proven track records, strong financial characteristics and above average growth prospects at attractive valuations will lead to strong relative returns over the long run. These companies have a proven track record of growing revenues and earnings, generating healthy returns and free cash flow, using cash in shareholder friendly ways and maintaining strong balance sheets.
Our investment process helps identify the highest quality growth companies, while avoiding story stocks with flaws in their fundamentals. Our process numerically scores every investment against specific quantitative and qualitative criteria measuring a company's Quality, Financial Strength and Growth & Profitability. We also assign a Valuation score based on an internally developed future earnings projection. Our process scores a company's relative attractiveness against their peers, identifying the highest quality companies at attractive valuations. While not a quantitative model, our ranking system provides a disciplined framework to guide investment management decisions.
Our portfolio structure strives to isolate relative performance to stock selection. We are fully invested, have a well-diversified, benchmark sector neutral portfolio and do not take large positions in individual companies.
Bridge City Capital Small Cap Growth Summary
- Benchmark: Russell 2000® Growth Index
- Fully invested
- Diversified 65-100 stock portfolio
- Sector neutral -target sector weights, +/- the greater of 20% of the weight of the defined sectors of the Russell 2000 Growth Index, or +/- 3 absolute percentage points from the defined sector weight within the index.
- Low turnover
- Top 10 positions represent approximately 20% of the portfolio
- Track record inception: July 1, 2009
- Vehicle: separately managed accounts
- Minimum investment: $1 million