The PalmerDodge Advisors investment decision making process is guided by independent, in-house research utilizing various qualitative and quantitative criteria.
Our stock selection process is disciplined and focused on companies that we expect will consistently generate above average returns. It begins by screening an investment universe of about 1,500 well established companies for superior sales and earnings growth, return on assets, and balance sheet quality. Large and mid-size capitalization companies are emphasized and we do not purchase stock of companies with market capitalizations and annual revenues below $1 billion.
The resulting subset of companies is carefully scrutinized for potential opportunities with particular focus on industry leaders that have a demonstrated track record of success as well as companies with emerging product pipelines that are not fully recognized by the market. Our valuation discipline guides us toward stocks that we feel offer reasonable reward given our understanding of the company's future growth prospects.
Particular attention at any given time is usually focused on approximately seventy to eighty companies. Those firms are widely owned by our clients or they represent an attractive buying or selling opportunity.
With respect to fixed income, the primary focus is twofold: income generation coupled with eventual return of principal. To ensure that we meet these objectives, bond purchases are typically concentrated among U.S. Treasury and Agency securities, municipal bonds and investment grade corporate bonds.