This article is excerpted from a letter by MOI Global instructor Mark Walker, Managing Partner at Tollymore Investment Partners, based in London.

We discussed in detail the reasons behind our purchase of GRUB shares in our September 2019 letter to partners. In short, we believe the business scores very highly across the core aspects of business quality we seek in holding companies: a simple business; soundly financed; strong track record; well positioned to defend and grow intrinsic value over time; and thoughtfully stewarded. We are conscious that GRUB is a heavily shorted stock that divides investment opinion. This is neither something we seek nor shun in our investments. Regardless of others’ thoughts of the companies we own, our decisions to own them are made independently, after conducting research calmly in a quiet room and, we hope, based on objective information and insights. Emotionally bashing or defending stocks on investment forums and social media is a waste of cognitive energy at best. In addition, it seems likely to introduce hurdles such as commitment bias into decision making.

A few weeks after we initiated our position the company released its third quarter results, accompanied by a letter from management which sent the stock down 43% in a single day. The vitriol from short sellers and the financial press was deafening.

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Disclaimer: The contents of this document are communicated by, and the property of, Tollymore Investment Partners LLP. Tollymore Investment Partners LLP is an appointed representative of Eschler Asset Management LLP which is authorised and regulated by the Financial Conduct Authority (“FCA”). The information and opinions contained in this document are subject to updating and verification and may be subject to amendment. No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained in this document by Tollymore Investment Partners LLP or its directors. No liability is accepted by such persons for the accuracy or completeness of any information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained in this document. The information contained in this document is strictly confidential. The value of investments and any income generated may go down as well as up and is not guaranteed. Past performance is not necessarily a guide to future performance.