One-Year Returns for Evans Capital Partners

+45%
Net return  ·  April 2025 – April 2026
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The Problem

Most active managers fail to beat the market.

The techniques are well understood. Data is available to everyone. The failure is not informational — it is behavioral. Two root causes explain most underperformance.

Behavioral Biases

Acting independently of the crowd is very difficult, in both up and down markets. Acting independently is essential to earn excess returns.

Forecasting Errors

Most investment approaches require predicting future earnings, growth rates, and competitive dynamics. These forecasts are genuinely difficult to get right, and the errors are exacerbated by behavioral biases.

Overcoming these biases requires a fundamental, disciplined, repeatable process.

The Answer

Anchor on what we can know today.

We strip forecasting out of the equation. We value businesses on two observable facts that exist today — the tangible assets they own and the earnings they have consistently generated through full economic cycles.

"Net assets pin the value of the company. Normalized earnings confirm it. Conviction is built when both anchors agree."

I
Tangible Book Value
The liquidation floor

We are buying real assets for less than their cost to build. Real assets — factories, inventory, receivables — after paying all liabilities. Excludes goodwill, brand value, and intangibles that evaporate in liquidation. That is a margin of safety that requires no forecast.

Target: Tangible BTM ≥ 1.5
II
Normalized Earnings
The going-concern value

We strip out peaks and troughs using ten-year average income — the Shiller CAPE logic applied stock by stock. This eliminates cyclical noise and accounting distortions, revealing the sustainable earnings power of the business as it actually operates.

Target: Normalized P/E ≤ 10
Conviction is built when both pillars agree.

The Investment Criteria

Invest When There is a High Probability of Doubling in Two Years.

Quantitative Entry Gate
Tangible Book-to-Market BTM ≥ 1.5×
Normalized P/E Ratio N-PE ≤ 10×
Additional Qualitative Filters
Reasonable leverage — less than 2 times tangible book
Good management, especially regarding capital allocation
Industries and firms that we can understand, and aren't at existential risk
Seeking firms that we conservatively value at twice the market price, that have a high probability of doubling in two years.

Current Portfolio

Every holding passes both quantitative anchors.

The S&P 500 comparison uses GAAP book value (not tangible book) and the Shiller CAPE for normalized P/E — both of which understate the true valuation gap between the index and our portfolio.

Company Market Cap Tangible BTM Norm. P/E Notes
AerCap $22.5B 1.56× 7.0× Aggressively repurchasing shares
Close Brothers Group £672m 2.19× 8.4× Lawsuits have been resolved
Consorcio ARA p$5.4B 2.98× 6.0× Profits accelerating
Gulf Marine Services £205m 1.60× 8.0× Operations disrupted
Navios Maritime $2.0B 1.30× 7.3× Accelerated stock repurchases
Onity Corp $394m 1.60× 7.7× Selling reverse mortgage business
S&P 500 — 0.18× 40.6× GAAP book; Shiller CAPE

* As of April 25, 2026. Holdings subject to change. This is not investment advice or a solicitation.

The Evidence · Methodology

A rigorous 33-year out-of-sample backtest.

33
Annual formation cohorts
1991 through 2023
462
Total firm-year
observations
2yr
Return measurement window
per cohort

We replicated and extended Lakonishok, Shleifer & Vishny (1994) using CRSP and Compustat data from WRDS — the same institutional databases used by academic researchers. Each April, all companies meeting the four-factor screen were identified. Their two-year forward returns were then calculated and compared to the S&P 500 over the same period. The screen was tested across all market cap ranges; the $100M–$500M filter reflects our live portfolio focus, not a data-mined result.

Source: CRSP/Compustat Merged via WRDS. Benchmark: S&P 500 April-to-April price index. Past performance is not indicative of future results.

The Evidence · Results

The screen outperformed in 76% of years.

+44.4%
ECP Screen · Weighted Mean 2-Year Return
+19.8%
S&P 500 · Average 2-Year Return
+24.6%
Average Excess Return
0
Confirmed Distress Exits
Across 462 Firm-Years
Two-Year Average Returns by Annual Formation Cohort
ECP Screen vs. S&P 500  ·  1991–2023  ·  33 Cohorts
ECP Screen
S&P 500

CRSP/Compustat Merged via WRDS. Past performance is not indicative of future results.

Account Structure & Terms

Your account. Your securities.
Full transparency.

How It Works

  • Your own separately managed account at Interactive Brokers
  • You retain full ownership and can view holdings at any time
  • Evans Capital Partners has limited trading authority only
  • All accounts mirror the same portfolio — same positions, same weights
  • No pooled fund — you own your securities directly
  • Quarterly performance reporting plus real-time IBKR portal access
Terms at a Glance
Minimum Investment $250,000
Management Fee 1.0% / year
Performance Fee None
Liquidity At your discretion
Custodian Interactive Brokers
Reporting Quarterly + IBKR portal

Get Involved

We are selectively accepting new accounts.

We want investors who understand and believe in the approach — not investors who are doing us a favor.

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tevans@evans-capital.com  ·  (607) 319-1191  ·  www.evans-capital.com

Evans Capital Partners LLC is a registered investment adviser. This page is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any security. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal. All performance figures are unaudited.