"Pitch me a stock" for SA interviews
Rising sophomore, have 3 pitches with full models and slide deck, likely going to make a few more before recruiting starts.
I'm curious when interviewing for MM l/s or L/O asset managers if there are restrictions on the names you pitch in response to "pitch me a stock."
I like to cover a fairly unique vertical, and also have a somewhat unique approach to valuation within this vertical because of my background. The issue is two of my pitches are small caps, and all of them are not US publically traded.
Should I try to read up on a few US-stocks when interviewing with firms in the states? Its probably very unlikely these names are in the coverage of firms I'm hoping to recruit at.
There are no restrictions and don't think they care about cap.
You'll change the dynamic of your interview if addition to defending your thesis now you need to defend other criticisms. One problem with pitching a stock that has too small of a market capitalization is that your thesis might only hold up to scrutiny on paper. On a conceptual level it likely won't be a problem as long as you fit what you're applying for.
got it. Maybe if they ask for two, i give either a long and or a short on a more covered name in my fav vertical, and then give one of my favorite small caps for a second one
I think if you have 3 full pitches with models made for the question “pitch me a stock”, you should be fine, just don’t pick a small cap, will require you to explain more which leaves u vulnerable to messing up
yeah plenty of time to develop a long and short on two names anyways—will do
I would also kinda say ditto for it being a non-US listed company. You can probably get away with it if its in a relatively developed market (eg Europe) but if its a China ADR you are pitching it'd tread carefully unless you know the fund invests in stuff like that.
Also, you are spooking me a bit on your "somewhat unique approach to valuation" comment. Don't know if you can share more on what exactly it is, but you better be prepared to defend your rationale for why it makes sense in this context
for these kinda of small caps I use extensive alternate data relevant for estimating revenue. I come from a quantitative background. The actual models aren’t anything different. But I do think the background research I do is pretty impressive / I don’t see many digging this deep.
Where are you getting this alternate data? Good sources that give you legitimate panel data cost hundreds of thousands and would not be available to college students (to my knowledge). Goes without saying this is not a unique approach to valuation….
Oh you're just talking about how you forcast your earnings model - that's totally fine and likely similar to how they do it as well.
also, when you give a short, does it need to be a naked short, or can you pair it with a long?
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