Our Process

The Oberweis Aperture

Oberweis Asset Management, Inc. is focused on investing in small- and mid-cap stocks around the world. All of our strategies are based on behavioral finance anomalies.

Through the Value-Centric Lens

When seeking undervalued opportunities, our focus reflects an approach consistent with and complementary to our other strategies in many ways. Our value team specializes in Mosaic Theory in order to identify occurrences of mispricing by the broader market. Utilizing a multi-step, highly disciplined process, we take publicly available information and establish a unique, value-oriented and often contrarian view which is the Oberweis Value Aperture.

The Oberweis Value Aperture focuses attention on the signals indicating potential undervaluation while reducing the emphasis markets place on price- dislocating noise. This enables our team to strategically identify mismatches between consensus expectations and underlying fundamentals.

The Aperture strategy provides a depth of perception by separating rumors from facts to see the nature of each company’s situation more clearly, free of behavioral biases and widely held expectations.

This disciplined approach also provides a natural stability and consistency to the strategy’s return profile by balancing risk with the potential for behaviorallybased appreciation.

Information Signals

We seek out verifiable indicators that suggest a potential catalyst for price movement or growing market recognition of a company’s future prospects.

Behavioral Market Under/Overreaction

We watch for price movements, trading trends, and sentiment shifts that are disproportionate to changes in a company’s true value.

Strong Cash Flow Generation

We invest in companies that demonstrate a consistent ability to attract customers, compete within their industry, and wisely manage their resources.

Prudent Debt Management

We invest in profitable and scalable business models, which tend to generate rising net profit margins as revenue growth accelerates.

Sustainability

We invest in businesses that are significantly undervalued based on PEG ratio calculations using our earnings estimates and growth forecasts.

Valuation

We look for a recent positive earnings release or an earnings surprise that tangibly and quantitatively begins to confirm that analyst expectations are too low.

Inflection Point of Change

We look for businesses at the inflection point of change — often from a new product, a new management team, or a regulatory change — as these changes can drive unexpected or underestimated growth. We invest in firms with significant gaps between our forecasts and analyst expectations.

Limited Analyst Coverage

We look for small- and mid-cap firms not widely followed by other analysts to maximize the chances of finding misunderstood situations.


Invest Now