Financial metrics are crucial for evaluating a company’s value, but they don’t tell the whole story, writes ESG Analyst/Portfolio Manager Petra Daroczi. Human capital – the knowledge and skills people acquire throughout their lives – can be a significant competitive advantage, much like traditional capital expenditures on goods and services.

Europe’s largest companies are powering the MSCI Europe index, with market giants over €100bn contributing nearly 20% to returns. Despite challenges like inflation and geopolitical tensions, many have remained resilient. But what sets apart these companies from those that have hit their peak? Product Specialist Wolfgang Fickus dives into what makes these leaders stand out from the herd.

Based in the Land of the Rising Sun, Portfolio Manager Richard Kaye dives into the value versus growth debate in our latest investment letter on Japan. He highlights that while so-called value stocks have benefitted from higher inflation and interest rates, Comgest’s consistent, long-term growth style is designed to thrive beyond these temporary market shifts. From our perspective, quality growth companies are better positioned for long-term success.

These days the world seems to be changing faster than ever. Rising geopolitical tensions and technological advancements, such as artificial intelligence, are increasing volatility in the global economy.

How does M&A factor into the growth of compounders companies? Being a “marathon runner” requires more than just a venerable age (an average of 126 years in our portfolio). Over time, these companies have used their resilience and built up competitive moats yielding exceptional free cash and healthy balance sheets. By leveraging these elements, compounders seize on M&A opportunities to fuel future organic growth.