By the book

| Print |  Email
Articles - Jan/Feb 2012
Thursday, January 19, 2012
Article Index
By the book
Page 2

By Oakley Brooks

 

0112_Tactics_01
Photo by Michael G. Hale

Patrick Becker Sr. is 70 years old now and slowed significantly by a stroke he suffered five years ago. But all one has to do is mention “The Letter” and his eyes light up and a wave of energy pulses across his elfin face. He is back in the fourth quarter of 1999.

“That was a tough time,” he says, softly. “The growth guys were shooting the lights out.” Everybody was winning big except Becker’s investment clients. That’s because Becker smelled a rat in most tech stocks, and he wouldn't have any part of them. He’s a value investor, sticking to companies with strong balance sheets, long-term fundamentals and cheap share prices: paper companies, gas conglomerates and machine-works outfits that were, in the late 1990s, so 1980s.

0112_Tactics_04

Becker Capital Management

Chairman: Pat Becker Sr.

President: Pat Becker Jr.

Incorporated: 1976

Employees: 28

Under management: $2.1 billion

Fun fact: Pat Becker Sr. once finished in the top five in the Portland Marathon and counts runners Alberto Salazar and Joan Benoit Samuelson as friends.

But meanwhile, his clients were going crazy on the sidelines of the boom, calling him old-fashioned on the phone and leaving Portland-based Becker Capital for the first time in the firm’s 24 years. The staff gave a unanimous vote of confidence to Becker’s approach during a soul-searching meeting that year, but Becker was losing sleep as he sat at his keyboard to tap out his final quarterly letter of 1999 to clients. What was keeping him up at night, he wrote, was the “fear that our clientele, one by one, will be drawn into the ever-growing feeding frenzy of market hype and speculation. In my judgment, a growing portion of the current market action is nothing more than a giant casino.” Whatever the pressure to roll the dice, Becker would not break. “In a period of euphoric speculation, we must stay true to our disciplines and use plain common sense,” he wrote.

Over the next 12 months, the Internet balloon hemorrhaged air and smashed to Earth, ruining legions of dotcoms and erasing an estimated $800 billion in value in the tech space. But Becker’s portfolio chugged along in the black in 2000 and 2001.

“We’re more proud of that moment than any other,” says 46-year-old Patrick Becker Jr., the company’s president.

Through the lost decade that followed, Becker has remained strong and steady, like the marathoner Pat Sr. once was. And its portfolio — now at $2.1 billion — has paid dividends for the individuals and institutional investors who stood by the company: Its investments earned 6.1% annually over the last 10 years, compared to 2.8% for the S&P 500.

The company’s approach plays out in deep and relentless research by Becker staff, which includes Ph.D.s and some of the more seasoned analysts picked up as banks and investment houses in Portland have downsized, merged and consolidated in recent years. Becker hosts each year 400 to 500 company managers and outside analysts at the firm’s Key Bank tower offices for briefings. Staff members pore over quantitative data looking for bargains in stock price multiples.

 



 

More Articles

Community colleges and sustainability

Contributed Blogs
Thursday, July 31, 2014
sustainabilityBY MARY SPILDE | OB GUEST CONTRIBUTOR

Faced with the aftermath of the “great recession,” increasing concern about the environment and dwindling family wage jobs, we have some very important choices to make about our future.


Read more...

Buyer's Remorse

September 2014
Tuesday, August 26, 2014

Parents and students paying for college today are like homeowners who bought a house just before the housing bubble burst.


Read more...

Back to School

September 2014
Wednesday, August 27, 2014
BY LEE VAN DER VOO

By now we’ve all read the headlines: Starbucks is giving away free degrees. Except it isn’t.


Read more...

Two sides of the coin

Contributed Blogs
Monday, August 25, 2014
0825 thumb moneyBY JASON NORRIS | OB GUEST BLOGGER

Ferguson Wellman’s investment views on the economy and capital markets.


Read more...

Podcast: Interview with Steve Balzac

Contributed Blogs
Tuesday, August 19, 2014

082014BalzacBY TOM COX | OB BLOGGER

Tom Cox interviews Steve Balzac, author of "Organizational Psychology for Managers."


Read more...

A Good Leap Forward

September 2014
Wednesday, August 27, 2014
BY AMY MILSHTEIN

Agriculture businesses ramp up to meet international demand as workforce and succession challenges loom.


Read more...

Is this employee right?

Contributed Blogs
Wednesday, August 13, 2014
081314 thumb employeefeelingsBY TOM COX | OB BLOGGER

When I say, “Your Employee is Always Right,” I do not mean “right about the facts,” but rather “right about how they feel” and “right about how they want to be led.”


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS