Based on traditional Graham & Dodd value investment principles, Pendo is a long-term value investor with a contrarian view.
Pendo is a long-term investor, strives for absolute returns, and does not 'hug' and index; as such it is agnostic with regard to market cap, sector & geography.
Pendo considers itself a business analyst rather than a stock analyst. A concentrated focus on the actual business presents a clearer understanding of how a given investment should fare over time.
The future of businesses with a competitive advantage, under normal circumstances, is predictable. Therefore, they are often followed by a large group of analysts and often expensive. A herd mentality is not uncommon.
Pendo's intention is to purchase securities below the intrinsic value of each underlying business. The margin of safety is provided after ascertaining the intrinsic value, and then purchasing those securities selling at a discount to that price.
As contrarian investors, Pendo asserts that the best investment opportunities present themselves when discovering an opportunity out of favor or hidden from the typical fund manager.
Opportunities are often found when companies, sectors, or geographical investments are out of favor. As contrarians, we look for out of favor investments and determine whether there is a reason for them being out of favor or not.
Other opportunities are found when there are no or few analysts following a company, as often is the case with spin-offs. Pendo and its analysts have followed spin-offs since the mid 90s and have several proprietary research studies concluding that as an asset class, spin-offs have provided well above market returns.