Pieter Slegers (Compounding Quality): The Art of Quality Investing: How to Invest in the Best Companies in the World

Talking Billions with Bogumil Baranowski

My guest today is Pieter Slegers. He is the writer behind the widely popular newsletter Compounding Quality. He lives in Belgium, and used to work for a Belgian Asset Manager. His hobbies are running (he ran his first marathon last year), lifting weights and reading books. Pieter is a co-author with Luc Kroeze of a recently published book The Art of Quality Investing: How to Invest in the Best Companies in the World. It’s Pieter’s second appearance on the show, I highly recommend looking up his earlier episode. We talk about the importance of simplicity and understanding the business model in quality investing. My guest discusses how quality companies with reinvestment opportunities and pricing power are the most favorable investments. Pieter shares that holding quality stocks for long periods requires patience. We also talk about how growth and pricing power are crucial factors in the long-term success of businesses. My guest emphasizes that investors should focus on the journey and the potential for long-term returns. We discuss that management's capital allocation skills and alignment of incentives are important factors to consider. Pieter shares quantitative criteria for evaluating companies, such as a healthy balance sheet, high free cash flow conversion, and attractive growth. We talk about portfolio construction, including position sizing and knowing when to sell stocks. Stay tuned until the end to hear my guest share what we should focus on considering quality investing. 05:00 Introduction and Meeting the Co-Author 14:13 The Importance of Simplicity and Understanding 20:08 The Global Opportunity and Diversification 30:20 The Importance of Growth in Quality Investing 36:33 The Significance of Pricing Power 51:19 The Significance of Management in the Investment Process 01:02:43 Quantitative Criteria for Evaluating Companies 01:06:52 Portfolio Construction and Position Sizing 01:19:58 The Principles and Strategies of Quality Investing Podcast Program – Disclosure Statement Blue Infinitas Capital, LLC is a registered investment adviser and the opinions expressed by the Firm’s employees and podcast guests on this show are their own and do not reflect the opinions of Blue Infinitas Capital, LLC. All statements and opinions expressed are based upon information considered reliable although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Information expressed does not take into account your specific situation or objectives, and is not intended as recommendations appropriate for any individual. Listeners are encouraged to seek advice from a qualified tax, legal, or investment adviser to determine whether any information presented may be suitable for their specific situation. Past performance is not indicative of future performance.