When we think about investing in equities here at Carnegie, we think of the companies we invest in as businesses. If I polled 5 random people off the street and asked them to list 5 good companies, depending upon their age, sex and race, I would probably hear names like Apple, Facebook, Google, Tesla and Netflix. While these companies have performed admirably in the last few years, we never lose sight of our pursuit in finding great businesses with sustainable business models or what Warren Buffet likes to call a “moat”. What if I told you that one of the best sectors to invest in over time is a collection of boring, slow growing businesses?
As a firm with roots in Cleveland, the city is abuzz with excitement surrounding the Cleveland Cavaliers run to the NBA Finals. It is great to experience the excitement that cities like Cincinnati and Philadelphia have enjoyed in the past and our hope is that this team will end Cleveland’s 51 year title drought. The Cavs will need to play great team basketball to beat the Golden State Warriors but when it comes to investing; sometimes it’s best to separate certain parts of the “team” or businesses. This is often referred to as spin-offs on Wall Street.