This article by MOI Global instructor Shreekkanth Viswanathan is excerpted from a letter of SVN Capital, based near Chicago, Illinois.
We currently own 13 investments. Cash is slightly more than 3.0%.
Our portfolio is geographically diversified — eight of these companies are listed in the US, two in Italy, and one each in Canada, France, and the UK. In reality, what matters is not where these businesses are listed, but where these businesses are generating their revenues from and incurring their costs at.
By that definition, our portfolio is geographically well diversified. Using full year 2018 results, our portfolio of businesses generated about 48% of their revenues from the US and the balance 52% is widely diversified between Asia, Latin America, Middle East & Africa, UK, and Continental Europe.
Top five holdings account for 52% and top ten holdings account for 84% of the portfolio.
We own good businesses that 1) are run by competent management teams (many of them are owner-operators), 2) have tremendous opportunity to redeploy their earnings back into the businesses, 3) are trading at a reasonable valuation. In fact, some continue to trade at a significant discount to intrinsic value.
A brief overview of the top five holdings:
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