By the book

| Print |  Email
Articles - Jan/Feb 2012
Thursday, January 19, 2012

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

Storyteller in Chief: Natural Prophets

July/August 2015
Monday, July 13, 2015
BY SAM BLACKMAN

Storyteller-in-chief with the CEO and co-founder of Elemental Technologies.


Read more...

Child care challenge

September 2015
Wednesday, August 26, 2015
0927OHSUhealthystarts-thumbBY KIM MOORE AND LINDA BAKER

Child care in Oregon is expensive and hard to find. We delved into the numbers and talked to a few executives and managers about day care costs, accessibility and work-life balance.


Read more...

Best Foot Forward

July/August 2015
Monday, July 13, 2015
BY CHRIS NOBLE

Whether you're stepping out to work or onto the track, Pacific Northwest shoe companies have you covered.


Read more...

Loose Talk

July/August 2015
Friday, July 10, 2015
BY AMY MILSHTEIN

When gossip crosses the line.


Read more...

Grain Food

September 2015
Wednesday, August 19, 2015
BY JACOB PALMER

A Power Lunch at Bob's Red Mill Whole Grain Store and Restaurant.


Read more...

Business partnerships: taming the three-headed monster

Contributed Blogs
Monday, July 06, 2015
070615-businessmarriagefail-thumbBY KATHERINE HEEKIN | OB GUEST COLUMNIST

Picking a business partner is not much different than choosing a spouse or life partner, and the business break-up can be as heart-wrenching and costly as divorce.


Read more...

The 10 most successful crowdfunding campaigns in Oregon

The Latest
Wednesday, August 19, 2015
081915-crowdfundingmainBY JACOB PALMER | DIGITAL NEWS EDITOR

One of the hottest new investment trends has proven quite lucrative for some companies.


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