By Beutel Goodman | March 30, 2021

A dramatic gap has opened between growth and value investing over the last 10-year bull market and some have questioned whether value investing – and by extension, Beutel Goodman’s process – still works. But in Beutel Goodman’s view, this growth versus value conversation needs to be reframed.

They define value on their terms, with a unique yet simple approach to investing. Using strict investment research guidelines, they select a concentrated portfolio of business that they can own forever, so long as valuations don’t become excessive. Quality should never be sacrificed in the pursuit of value, which is why they define intrinsic value as the present value of sustainable free cash flows. Having high free cash flows is far less attractive for investors if it’s accomplished with an over-reliance on leverage or without a strong competitive position with a wide protective moat. Maintaining an active share of high-quality stocks means that its equity portfolio doesn’t follow value or growth benchmarks.

Beutel Goodman use these principles and long-term focus to find value for clients as the fund manager for a variety of equity funds on the Canada Life™ shelf, including Canada Life American Equity and Canadian Equity. Uncovering sustainable, high-quality franchises takes conviction and experience, and it’s something Beutel Goodman has been doing for over five decades.

Read the following article to learn more about Beutel Goodman’s distinct approach to value investing.

The views expressed in this commentary are those of this fund manager as at the date of publication and are subject to change without notice. This commentary is presented only as a general source of information and is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax or legal advice. Prospective investors should review the offering documents relating to any investment carefully before making an investment decision and should ask their financial advisor for advice based on their specific circumstances. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. Unit values and investment returns will fluctuate.

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