Cannae is a Sydney based boutique funds management business. Cannae specialises in investing in Australian and New Zealand securities which meet its investment criteria.
Cannae believes that careful stock picking is critical to superior investment performance. Cannae adopts an approach of thoroughly assessing all investment opportunities on their merits using a "bottom up" process. Cannae does not believe that stocks need to appear cheap relative to the market to be undervalued: price is meaningless without understanding the quality of the business's franchise, earnings capability and assets. In particular, Cannae looks for companies that it assesses as having strong cash generating ability. This seeks to ensure that Cannae is not fooled by fictitious accounting profits, and that, in the opinion of Cannae, these companies normally have strong balance sheets. Companies should also ideally earn strong returns on the capital employed in the business.