SMID Cap Value Q2 2017


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40 to 50

companies in our fully invested, concentrated portfolio

14

year track record

$16

million SMID Cap Value assets under management as of 6/30/2017

99%

upside market capture ratio since inception (1/1/04)

91%

downside market capture ratio since inception (1/1/04)

  • Guides

    Philosophy

    • Fundamentals drive stock prices
    • Capital preservation improves returns
    • Culture shapes investment decisions
  • Shapes

    Process

    • Thorough, proprietary research by career analysts
    • Focus on valuation and risk controls
    • Team environment – group discussion/analyst decision
  • Generates

    Portfolio

    • Concentrated and diversified
    • Long-term/low turnover
    • Fully invested/limit on cash
  • Performance

    • Consistent pattern of results
    • Objective: Outperform the benchmark over the longer term

SMID Cap Value

Quarter 2 2017

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell 2500™ Value Index
Annualized Returns As of 6.30.2017 Source: Factset and Russell® Past Performance is not indicative of future results Taxable client returns may vary from the results above due to tax-efficient portfolio management and higher fee schedules that result from lower portfolio minimums. Click for additional C&B SMID Cap Value Performance Disclosures

Quality Characteristics1

  • C&B SMID Cap Value
  • Russell 2500™ Value Index*
ROC 5 Year Avg Cash Interest Coverage Debt/Ebitda Forecast P/E** P/Normalized Earnings**
6.9% 8.1x 2.5x 15.9x 13.3x
3.5% 6.2x 2.6x 17.4x
ROC 5 Year Avg 6.9% 3.5%
Cash Interest Coverage 8.1x 6.2x
Debt/Ebitda 2.5x 2.6x
Forecast P/E** 15.9x 17.4x
P/Normalized Earnings** 13.3x
Period Ending: 6.30.2017 * Median ** Weighted Harmonic Mean Source: Factset and Russell®

Portfolio Attributes1

  • C&B SMID Cap Value
  • Russell 2500™ Value Index
# Holdings Market Cap ($B) Range Market Cap ($B) WTD Avg Annual Turnover
44 0.7 - 15.8 5.5 55%
1,769 0.09 - 11.7 4.3
# Holdings 44 1,769
Market Cap ($B) Range 0.7 - 15.8 0.09 - 11.7
Market Cap ($B) WTD Avg 5.5 4.3
Annual Turnover 55%
Source: Factset and Russell®

Top 10 Holdings1

FirstCash Inc. 4.4%
Winnebago Industries Inc. 3.7%
Gildan Activewear Inc. 3.6%
Quanex Building Products Corp. 3.2%
Hill-Rom Holdings Inc. 3.2%
Fidelity National Financial Inc. 3.2%
Schweitzer-Mauduit International Inc. 3.1%
Laboratory Corporation of America 3.1%
Mednax Inc. 3.0%
Steelcase Inc. 3.0%

Top 10 Holdings1

FirstCash Inc. 4.4%
Winnebago Industries Inc. 3.7%
Gildan Activewear Inc. 3.6%
Quanex Building Products Corp. 3.2%
Hill-Rom Holdings Inc. 3.2%
Fidelity National Financial Inc. 3.2%
Schweitzer-Mauduit International Inc. 3.1%
Laboratory Corporation of America 3.1%
Mednax Inc. 3.0%
Steelcase Inc. 3.0%

Sector Weights1

  • C&B SMID Cap Value
  • Russell 2500™ Value Index
  • Consumer Discretionary

    C&B SMID Cap Value
    19.0%
    Russell 2500™ Value Index
    10.6%
  • Consumer Staples

    C&B SMID Cap Value
    1.7%
    Russell 2500™ Value Index
    3.4%
  • Energy

    C&B SMID Cap Value
    1.8%
    Russell 2500™ Value Index
    6.3%
  • Financials

    C&B SMID Cap Value
    22.1%
    Russell 2500™ Value Index
    24.6%
  • Health Care

    C&B SMID Cap Value
    13.3%
    Russell 2500™ Value Index
    6.0%
  • Industrials

    C&B SMID Cap Value
    19.0%
    Russell 2500™ Value Index
    13.1%
  • Information Technology

    C&B SMID Cap Value
    4.8%
    Russell 2500™ Value Index
    8.4%
  • Materials

    C&B SMID Cap Value
    14.0%
    Russell 2500™ Value Index
    5.3%
  • Real Estate

    C&B SMID Cap Value
    2.0%
    Russell 2500™ Value Index
    15.1%
  • Telecommunication Services

    C&B SMID Cap Value
    Russell 2500™ Value Index
    0.5%
  • Utilities

    C&B SMID Cap Value
    Russell 2500™ Value Index
    6.7%
  • Cash

    C&B SMID Cap Value
    2.1%
    Russell 2500™ Value Index
Source: Factset and Russell®

Market Commentary

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Investors shrugged off ongoing drama on the political stage both here and abroad along with continued Fed tightening to deliver a quiet second quarter for equities. The quarter was also a profitable one for equity investors, with gains across most major indices. The Cooke & Bieler SMID Cap Value strategy generated strong outperformance relative to the Russell 2500™ Value Index (R25IV).

Additional Cooke & Bieler SMID Cap Value Disclosures