David C. Muccia
David Muccia is committed to helping his clients achieve their long-term investment objectives through a risk-averse, fundamental research-driven, value-oriented investment strategy. Put another way, he looks to buy stock in companies at a significant discount to their intrinsic value, both to help protect shareholders in uncertain times and generate superior returns when management teams are able to efficiently execute their strategy.
David has successfully managed clients’ assets through rising and falling markets, and ever-shifting economic conditions, which gives him valuable perspective on what constitutes an attractive opportunity under various market circumstances. Additionally, David’s background in both credit and equity analysis enhances his ability to thoroughly evaluate a company’s capital structure, assess whether it is properly financed and able to capitalize on future opportunities, and determine its “margin of safety” if the operating environment weakens.
David works with his brother, Tim.
Portfolio Construction and Management
As a Portfolio Manager, David’s primary goal is to compound returns over a long period of time and in a tax-efficient manner. To meet that goal, David looks to invest in companies with proven management teams that are explicitly aligned with shareholders’ interests, dominant market positions, strong balance sheets, sustainable margins, and the ability to generate free cash flow. He spends a significant amount of time meeting with management teams in order to understand their capital allocation strategy and how returns on invested capital will create value through earnings and cash flow growth over time.
David’s accounts typically are:
- Constructed to meet each client’s specific risk profile and needs. To that end, cash is not typically fully invested on Day 1, but rather is invested over time as opportunities arise.
- Designed for a long-term investment horizon. David seeks to identify companies that he can own for several years, which typically show high returns on invested capital, generate strong free cash flow, and have low fixed-rate long-term debt.
- Diversified and stable, with investments in 25 – 30 companies. Historically, turnover has been low, at approximately 20% – 25% per year.