MiB: Ricky Sandler, Eminence Capital

This week, we’re talking to Ricky Sandler, chief investment officer and founder of Eminence Capital. Today, Eminence is a $7 billion global investment management organization. Sandler has become a savvy long/short investor and Eminence continues to successfully run several different long/short portfolios. Prior to launching Eminence, Ricky was Co-Founder and Co-General Partner of Fusion Capital Management, LLC. He currently advises the University of Wisconsin Foundation and is a member of the Development Committee, Investment Committee, and Traditional Assets Subcommittee. Ricky Sandler is also a Chartered Financial Analyst and a member of the New York Society of Security Analysts.

Sandler has successfully shorted many of his favorite meme stocks, from Gamestop to AMC. The extension during the pandemic boomlet led the firm to create a variety of hedges that limited short losses during the crisis, but allowed them to make gains when the reddit stock bubble burst. He credited Chewy’s founder, Ryan Cohen, with recapitalizing the firm when the stock soared, but believes the core business model is outdated and broken.

We discuss how the structure of the market has changed – his analysis differs from his friend David Einhorn in that Sandler points to the behavior of the active part. Besides a lot of closet indexing, the way active managers do fundamental research has changed a lot – more quantitative, thematic and trend based, as opposed to classic Graham & Dodd research.

A list of his favorite books is here; A transcript of our conversation is available here from Tuesday.

You can stream and download our full conversation, including any podcast extras, on Apple Podcasts, Spotify, YouTube and Bloomberg. All of our past podcasts about your favorite hosts can be found here.

Be sure to check out our Master of Business next week with Heather Brilliant, 2019 CEO of publicly traded Diamond Hill (DHIL). The firm manages $26 billion in client assets through a bottom-up stock selection. Previously, she was CEO of First State Investments.

Favorite books