Mike Willans is head of International equities at Canada Life Investments and manager of the CF Canlife North American fund. His diary runs from 8-15 June
Saturday US research trips generally start for me on a Saturday. I’m off to the airport early to catch a flight to Chicago to attend a growth stock conference (with a strong mid-cap focus) and meet with US companies first-hand. The flight allows some pre-reading ahead of visits and a little downtime. After the inevitable immigration queues (90 minutes) it is off to the hotel, a quick bite to eat and then bed, though not before the spectacle of observing Chicago’s version of the World Naked Bike Ride!
Sunday Sunday is a day for getting into the right time zone, more company visit preparation and some observation of the state of US consumption. Michigan Avenue is a street full of high-end designer stores and on this day it was certainly very busy. The macro picture is the starting point of my investment process, so an on-the-ground glimpse of consumer sentiment is hugely helpful. I FaceTime with my family and the day closes with a Bikram Yoga session – 90 minutes of heat and exercise in a local studio.
Monday The day starts with a 5am Starbucks and at 7am, I’m off to meet some analysts to discuss their specialists sectors and investment ideas. Late morning is a trip to an O’Reilly store (aftermarket autoparts) to meet management and discuss their outlook. These tours are not common but really help me to visualise a potential investment. Lunch is a great session about the future of US healthcare and its implications for a variety of companies. Then off for another tour, this time of a new style Walgreens, a US pharmacy, and a once top-10 holding of mine. I somehow squeeze in another yoga session.
Tuesday The conference begins today. A few hundred companies and 1,000 or so portfolio managers are all crammed into one hotel. It is a real buzz. There are nine interesting companies over the day for me, three of which we subsequently invest in. Garmin (satellite navigation), Scotts Miracle Grow (garden products) and Bloomin’ Brands (restaurants) all make it into the portfolio after more work later on. As a contrarian manager, I tend to go after less-loved companies, and visits like these help me to cut out the noise in the markets and focus on the fundamentals of these companies. More yoga anyone?
Wednesday The day starts well with another nine potential investments. Two of these become holdings; Ritchie Brothers (auctioneers) and Expeditors (transport logistics). All in all, a productive conference. The afternoon sees a trip back to the airport as I’m heading to Toronto for a client meeting. My afternoon flight is cancelled owing to one of Chicago’s well known thunder storms.
Thursday Get up at 3am to return to the airport for a 6:30am flight. I arrive in Toronto with 50 minutes to spare but the client meeting goes well and then it is straight back to the airport to pick up another flight to Denver for more meetings. The US immigration official wanted to chat about the US equity market for some minutes and seemed rather knowledgeable. He was more than a little curious about a UK citizen covering the US stockmarket for a Canadian company based in London which, as I was saying it, did sound rather implausible. But it works.
Friday Last day of the trip and I’m up at 5am for another Starbucks and final preparation for the day’s meetings with five individual companies. This means an hour of access to very senior management and real insight into their corporate strategies. The highlight of day was Natural Grocers by Vitamin Cottage, a young growth company in organic retail at lower price points, which we now own. It is opening stores rapidly and still sees potential for another 1,000 stores nationwide. One of the other attendees asked for a well known diet fizzy drink in the meeting. He was met with a horrified look by the Natural Grocers executive and the explanation that only organic drinks were in the building. Rather amusing and a mistake I’m glad I did not make.