Although we look for ideas externally, we conduct our own internal analysis and company valuations. We have a substantial investment library with historical and current data on a large number of companies. We also investigate company operations closely and first-hand. In fact, we make more than 700 visits a year to companies all over the world.

Evaluating Companies
Burgundy focuses on a company’s true value, not its market value. This means analyzing not only a company’s financial strength (good economics and ability to generate free cash flow), but also its intangible factors, which can be determined only by meeting and assessing a company’s management and board of directors.

Is management: experienced and capable of creating competitive business advantages? Are they engaged financially – so their interests are aligned with shareholders? Committed to building shareholder value over the long term? Once we identify a company that meets our investment criteria, we determine a conservative estimate of the company’s true intrinsic value based on a discounted free cash flow analysis. Only when the company’s stock price trades at a minimum 30% discount to our estimation of intrinsic value, do we consider it for investment.