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Felix Wintle
Fund Manager
There has been an intense focus on the macro for a long time now, particularly the inflation outlook and what the Fed might do with interest rates. Whilst we do incorporate the macro into our investment process, ultimately investing is all about finding great companies that have an exciting growth trajectory which you can sit with for the longer term.
One such company is SharkNinja, the maker of home appliances. Under the Shark brand the company makes vacuum cleaners and other homeware products and under the Ninja brand cookware and kitchen appliances, perhaps best known for its air fryers.
Earlier this week I met the CEO and his team in their engineering and testing labs located in Battersea Power Station. The tour around the labs was fascinating and the place really has to be seen to be believed; it felt like walking into Q Branch on a busy day. Teams experimenting with new product ideas and designs, other teams trying to break things and even a kitchen where new recipes were being tried out for the best-selling ice cream maker, the Ninja Creami. It was great to witness R&D in real time.
So why do we like the company? There are three key bull points:
- 1) SharkNinja has done that unusual thing of disrupting sleepy product categories with revolutionary innovation. Across their product range they have left the incumbents flat footed by delivering better products for better value.
- 2) By investing 9.5% of sales back into marketing, the company has built strong relationships with its customers and its retail partners. This has helped it to compound growth at 20% over the last 16 years.
- 3) Growth in the US was 22% in Q1, and it remains their biggest market for now. The International business however is growing much faster, at 42%, and is in the early stages of roll out. New markets like Germany and France are growing at triple digits.
With its diversified product range and innovation pipeline of 25 products coming through each year, the company is early in its growth trajectory and has its best years of growth ahead if it, in our opinion.
CEO Mark Barrocas projects the international business will eclipse the US business in the next 5 years, underpinning the eps growth of this dynamic company.
WARNING: All information about the VT Tyndall North American Fund(‘The Fund’) is available in The Fund’s prospectus and Key Investor Information Document which are available free of charge (in English) from Valu-Trac Investment Management Limited (www.valu-trac.com). Any investment in the fund should be made on the basis of the terms governing the fund and not