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Chuck Bath: The Evolution of a Value Investor

The noted Diamond Hill manager discusses the shorter durations of competitive advantages, how low inflation has curbed firms' pricing power, and what he considers to be the market's 'sweet spot.'

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Editor's Note: The following interview with Chuck Bath, comanager of Diamond Hill Large Cap, was recorded on March 4, 2020. As such, it doesn't incorporate recent market volatility, and the manager's views and positions may have changed since the recording.

Our guest on the podcast is Chuck Bath, a portfolio manager who has logged a tremendous record over nearly 40 years. Since 2002, Bath has been manager of Diamond Hill Large Cap, a $6 billion fund that earns a Morningstar Analyst Rating of Gold. He is assistant portfolio manager for Bronze-rated Diamond Hill Long-Short.

Prior to joining Diamond Hill, he steered Nationwide Fund to outstanding returns during 17 years at the helm. An accountant by training, Bath uses a patient value-oriented approach, seeking out companies with above-average returns on capital that are trading below his estimates of intrinsic value.

Background
Chuck Bath bio

Diamond Hill Large Cap DHLAX

Diamond Hill Long-Short DIAMX 

Diamond Hill blog

"Diamond Hill: Accounting for Taste," by Lawrence Strauss, Barron's, Dec. 12, 2015. 
 

Strategy and Portfolio 

"Permanent Change Versus Long-Term Fundamentals," by Chuck Bath, March 10, 2020. 

Diamond Hill Intrinsic Value Estimator

Security Analysis, by Benjamin Graham and David Dodd. 

Warren Buffett on Durable Competitive Advantage, April 21, 2018. 

"Valuing U.S. Equities: A Historical Perspective," by Chuck Bath, Austin Hawley, and Nate Palmer, as presented at the CFA Institute Financial Analysts Seminar in Chicago, Sept. 26, 2014. 

International Business Machines

Microsoft

Walmart

Amazon.com

Abbott Laboratories

Procter & Gamble

Eastman Chemical

Alphabet

"State AGs, Justice Department Discuss Google Antitrust Probe," by Diane Bartz, Reuters, Feb. 4, 2020.

Chevron

Norfolk Southern

Parker Hannifin

Peter Lynch

Jeffrey Vinik

John Neff

Robert Sanborn

Citigroup

Charles Schwab Corp

"The Charles Schwab-TD Ameritrade Merger Shocked Wall Street. Why It Had to Happen," by Lisa Beilfuss and Daren Fonda, Barron's, Dec. 16, 2019. 


Organization/Succession

"Diamond Hill Announces Addition of Austin Hawley as Co-Portfolio Manager on Large-Cap Strategy," Dec. 18, 2017. 

"Channeling His Inner Buffett," by Marla Brill, Financial Advisor, Dec. 2, 2019.