Smaller European companies with a global reach

Europe is one of the world’s key economic regions and is home to many businesses that are world leaders in their field, including among smaller companies.

 

Jupiter’s Pan European Smaller Companies fund gives investors access to a concentrated portfolio of the highest-quality smaller companies listed or headquartered in Europe. These companies are European by heritage, but their footprint is global for the most part.

 

The fund is managed by Mark Heslop, a highly experienced investor in European equities, with a proven track record of smaller company investing. Mark and the team follow a disciplined and iterative investment process resulting in a constant competition for the fund’s capital.

 

Applying Porter’s Five Forces, the business strategy tool developed by Harvard professor Michael Porter, Mark and the team assess a company’s value based on its long-term cash flow potential and weigh this up with their conviction in the business model and its growth potential. This approach allows the strategy to constantly remain focused on what the team deems the ‘best ideas in Europe’.

Conviction matters

The fund management team have the freedom to seek only the best quality European smaller companies on behalf of the fund’s investors. Mark and his team are committed to deep analysis of business fundamentals, seeking hidden gems that are underappreciated and often poorly covered by the market. They avoid businesses that do not have a differentiated offering, are heavily regulated or have inappropriately high levels of debt. The result is a well-spread yet focused fund of some 50–60 holdings carefully selected from a universe of around 1,500 investible companies.

High-quality franchises with a growth focus

Through bottom-up stock selection the team aims to find companies with high barriers to entry and the potential to deliver high and sustainable returns on invested capital. They also want to invest in companies that can benefit from market inefficiencies and are well placed to benefit from secular growth opportunities. Finally, the presence of a strong company management team whose interests are aligned with shareholders is key.

Sources of sustainable competitive advantage

Mark and his team target investments in businesses where they have identified sustainable competitive advantage(s) and attractive industry economics. They invest in these companies and allow the economics of the business to create a compounding effect over the long term. It is this long-term compounding of capital being ploughed back into a business at a high rate of return that helps drive the growth in value of a business and deliver attractive long-term growth for its investors.

A wealth of experience

Clients may benefit from Mark’s long and high-quality track record running European and global smaller company strategies. He has a tried and tested approach that is enhanced by his ability to draw on a range of expert investment knowledge and resources at Jupiter.