Research is an integral part of the Capital Management process. We draw on a range of sources for investment information, including company materials, proprietary databases, and Wall Street research. Before a new equity goes into our portfolios, we write an internal report that clearly states the investment thesis. Once we invest in a company, we continually track the company to make sure it is meeting our expectations.

Our equity investment approach is oriented towards high quality companies with long-term business strengths. We look for the following qualities in our equity selections:

• A leadership position within an attractive industry. This profile must be supported by a strong, dynamic, and innovative management team. We like companies that reinvest their profits in order to develop new products, modernize manufacturing and distribution facilities, and expand into new markets.
• Good performance record. CMI generally favors companies with consistent earnings per share growth.
• Strong Financial position. Low debt exposure, strong cash flows, the prospect of above average dividend growth, and conservative accounting are favorable attributes.
• Reasonable valuation relative to historical levels, comparable companies, and the stock market.