Small to Mid Cap Value Equity

Sterling's Small to Mid Cap Value team is based in Charlotte and our approach is fundamental, bottom-up and value-oriented. The strategies identify stocks of quality companies selling at large discounts to the underlying value of the business. Sterling refers to its philosophy as an “owner’s approach” to investing which asks the same questions that a potential owner would ask if he were to enter into a private purchase transaction. This approach examines all factors relevant to the intrinsic value of the business using traditional fundamental security analysis; however, we emphasize these six key factors:

  1. Free Cash Flow
  2. Return on Invested Capital
  3. Sustainable Growth
  4. Durable Competitive Advantages
  5. Management
  6. Balance Sheet Strength

In sum, Sterling focuses on finding exceptional businesses with quality management whose stocks are selling at attractive prices. Quality businesses are defined as those that generate substantial levels of free cash flow, have numerous reinvestment opportunities at attractive returns, and enjoy competitive advantages.

Investment Process

  • Fundamentally Driven Analysis of each Company
  • Focus on Balance Sheet Quality
  • Multi-Dimensional Valuation Analysis
  • Well-Structured Sell Discipline

Portfolio Strategies

  • Small Cap Value Equity
  • Small / Mid Cap Value Equity
  • Mid Cap Value Equity