Introduction to Liontrust - Flipbook - Page 11
Global Innovation team
The four-strong Global Innovation team is co-headed by James Dowey
and Storm Uru who are supported by Clare Pleydell-Bouverie and
James O’Connor.
The team manages the Liontrust Global Innovation, Liontrust Global
Dividend and Liontrust Global Technology funds. James and Storm
jointly developed the Global Innovation investment process. The
four managers joined Liontrust as part of the acquisition of Neptune
Investment Management in October 2019. James Dowey has 16
years of industry experience and has researched and taught the
history of innovation at the London School of Economics, Storm
has 10 years’ industry experience, Clare undertook third-party
research for private equity firms across a variety of industries before
moving to Neptune and James O’Connor is a CFA Charterholder
and, prior to joining Neptune, completed his MSc in Education
Research at Oxford University.
Investment process
The team seeks to generate strong returns by investing in innovative
companies. They believe that innovation is the single most important
driver of stock returns, underpinned by three pillars:
• Innovative companies deliver superior operational performance
and shareholder returns over the long run.
• Innovation is much more than technology and is the key to success
in every sector.
• Innovation is complementary to the traditional investment styles of
value and quality, and a key part of an investment portfolio in the
21st century.
Stage 1
The team sets their investible universe to include only those companies
that are listed, liquid (with a market capitalisation above $1billion at
the time of purchase) and have the resources to innovate (based on
metrics of financial strength).
Stage 2
The team manages the Global Innovation 200 watchlist, an everevolving list of the most innovative companies around the world
across all sectors and regions. Every company that makes it onto the
list has four attributes:
• Innovation: Creates genuine value for customers by driving down
prices or providing more for its customers’ money.
STORM URU
JAMES DOWEY
CLARE
PLEYDELL-BOUVERIE
JAMES O’CONNOR
• Barrier: Has strong barriers to competition to capture value for
shareholders.
• Management: Has good management with the right incentives
and ability to execute.
• Cash returns on capital: Can convert its investments in innovation
into cash.
Stage 3
The team identifies the price they are willing to pay for a company
using a long-term DCF model. Their hurdle to invest is an anticipated
15% annual compound return. As part of the valuation, the team
conducts a risk assessment, covering financial, disruptive innovation
and ESG factors.
Stage 4
The team manages the portfolio based on the following principles:
• Stock weights are determined by each stock’s current valuation
upside and its contribution to the diversification of the portfolio.
• Portfolio fundamentals are monitored through management meetings,
company results, and announcements and industry research.
• The team’s typical intended holding period is three to five years.
Stocks are sold for three reasons: they hit their target price, a better
opportunity is identified on the watchlist or there is a breakdown
in fundamentals.
Liontrust investment teams and funds - 11