Methodology

We publish research on European small caps the sell side does not cover. This page sets out how that research is produced, so readers can judge it on process as well as conclusions.

Why this universe

Coverage follows liquidity, not business quality. Below roughly €500m of market value it thins; below €150m it largely disappears, leaving prices set by flows, family holdings and habit rather than analysis. That is where disciplined primary work still earns an edge. But neglect is not opportunity: an unfollowed company is as easily a promotional shell as a quiet compounder, and the two can trade alike. The work is telling them apart, one company at a time — not screening the group.

Coverage selection

We cover companies in Switzerland, Italy, Austria and Germany, broadly €30m–€500m in market value, with a strong bias toward names carrying no existing research. Beyond size and geography the test is practical: can we reach management, is disclosure good enough to build a model we genuinely believe, and does the business stand on how it operates rather than the story it tells? When we cannot get comfortable — on the accounts, on whether growth turns into cash, or on how controlling owners treat everyone else — we decline rather than cover with caveats.

How a thesis is framed

Each initiation is built on what we can defend, not what we can forecast. We start with what a buyer owns today: free cash flow that already exists or is plainly imminent, not a number years out in a model. We ask whether growth is worth funding at all — reinvestment rewards the owner only when a euro put back earns more than it costs, and much corporate growth quietly fails that test. And we name the specific trigger that would make the market look again — a senior listing, index entry, a margin inflection, or simply the arrival of first coverage — since a cheap share without one can stay cheap indefinitely. Every report says plainly which of these it rests on.

Throughout, we prefer being paid to wait. When the price already reflects a sober reading of the business, downside is contained and any re-rating comes free. Not losing money on a mistake counts for more, with us, than wringing the last euro from a success.

Sources

Our work rests on primary sources: statutory filings and annual reports in the original language, regulatory registers, concession and land registries, court records where relevant, customer and competitor interviews, site visits, and structured interviews with management. We cite sources in footnotes, and flag any number that is our estimate rather than a company disclosure.

Valuation

We value conservatively — mid-cycle, earnings-based multiples cross-checked against a discounted cash-flow model whose discount rate explicitly penalises illiquidity. We avoid target prices with false precision and never tune assumptions to reach a desired answer. Where the honest conclusion is a range, we publish a range.

Report types

• Initiation of Coverage — a full primary-source study of the business, usually the product of several months of work.
• Update Note — published after results, material announcements, or when our thesis-relevant estimates change.
• Flash Note — a short, same-week reaction to a discrete event, flagged as preliminary.
• Market View — a thematic note applying our framework to a specific market misreading, without an initiation's full primary-source depth.

Independence and payment

Most of our research is uncommissioned and paid for by subscribers. Where an issuer has commissioned research, the report is labelled issuer-sponsored in its disclosure block, and the same process, estimates and editorial standards apply.

Personal-account dealing

The analyst may hold positions in covered securities, and every report states in its disclosure block whether a position is held as of publication. Personal dealing is governed by a standing rule:

• No dealing in a covered security in the ten trading days before a report on it is published.
• No trading against a published conclusion for as long as it stands.
• Any position in a covered security is disclosed in every report on that company, and changes in that position are reflected in the next published note.

Errors

When we are wrong on facts, we correct the report and note the correction. When we are wrong on judgment, we say so in the next update rather than quietly moving on.