Stock Selection

Duncker Streett & Co. portfolios consist of 30 to 50 equity holdings diversified across market sectors and industries that have historically shown the ability to create long-term shareholder wealth.

We believe our cash flow-based investment philosophy differentiates Duncker Streett from our toughest competition. Our investment philosophy is disciplined, repeatable, and proven. Why cash flow? We have historically focused on cash flow as we believe it is the best measure of corporate performance and the best measure of the true economics of a business.  

Through our database, we search for companies that are increasing their cash flow rates of return and are undervalued relative to our price targets. Our research focuses on the key drivers of value creation. We believe cash flow drives stock prices rather than earnings. So, our team concentrates on the drivers of cash flow. Increasing cash flow is driven by increasing sales, increasing operating margins, and balance sheet productivity. Furthermore, we believe that capital allocation is a key driver of value creation. Thus, we take a deep look into how management teams have allocated capital in the past, their future priorities for capital allocation, and whether their previous allocation decisions have created shareholder wealth. There are four ways to allocate capital which include the following: reinvest back into the business, growth through M&A, share repurchase, or issuing a dividend. We are long term investors, not traders. We consider ourselves “business pickers” as opposed to “stock pickers.” In the equity portion of client portfolios, we think of our holdings as a “best ideas” portfolio. We believe that shows the conviction we have as “business pickers.” Our team strives to align client portfolios with management teams that have shown the ability to create long term shareholder wealth. We take immense pride in our research and knowing what we own in client portfolios which we believe is another factor that differentiates Duncker Streett & Co. from our toughest competition.  

Positions are sold in client portfolios due to valuation, a significant adverse change in the outlook for the business, better investment idea, a management mistake, or if a company is acquired. We do our best to hold turnover to a minimum.  

Questions that we ask ourselves

Is the company a solid long-term investment?

  • Increasing cash flow rate of return

  • Increasing sales growth and operating margins

  • Increasing asset productivity or sales per dollar of assets on the balance sheet

  • Strong balance sheet

  • Increase R&D productivity

  • Strong management track record of allocating capital

Is the business attractively priced?

  • What we believe the business is worth today

  • At least 20% upside to the Duncker Street target price

Reasons to sell the business

  • Valuation reaching our price target

  • Significant adverse change in the business

  • Better investment idea

  • Management mistake

  • Takeover

Learn More About Duncker Streett & Co.

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This website is for informational purposes only and should not be considered a solicitation by Duncker Streett & Co., LLC to transact business in any jurisdiction in which it is not excluded or exempted from registration as an investment adviser or in which Duncker Streett & Co., LLC has not complied with any registration or filing requirements. Advisory services offered through Duncker Streett & Co. LLC, a registered investment advisor.

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