Mid Cap Value Q1 2018


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40 to 50

companies in our fully invested, concentrated portfolio

20

year track record

$518

million Mid Cap Value assets under management as of 3/31/2018

101%

upside market capture ratio since 2000

79%

downside market capture ratio since 2000

  • 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

Mid Cap Value

Quarter 1 2018

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell Midcap® Value Index
Annualized Returns As of 3.31.2018 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 Mid Cap Value Performance Disclosures

Quality Characteristics1

  • C&B Mid Cap Value
  • Russell Midcap® Value Index*
ROC 5 Year Avg Cash Interest Coverage Debt/EBITDA Forecast P/E** P/Normalized Earnings**
7.1% 10.9x 2.4x 13.6x 12.5x
5.3% 6.8x 3.3x 16.0x -
ROC 5 Year Avg 7.1% 5.3%
Cash Interest Coverage 10.9x 6.8x
Debt/EBITDA 2.4x 3.3x
Forecast P/E** 13.6x 16.0x
P/Normalized Earnings** 12.5x -
Period Ending: 3.31.2018 * Median ** Weighted Harmonic Mean Source: Factset and Russell®

Portfolio Attributes1

  • C&B Mid Cap Value
  • Russell Midcap® Value Index
# Holdings Market Cap ($B) Range Market Cap ($B) Wtd Avg Annual Turnover
48 0.6 - 36.7 9.7 36%
582 0.6 - 41.9 13.9 -
# Holdings 48 582
Market Cap ($B) Range 0.6 - 36.7 0.6 - 41.9
Market Cap ($B) Wtd Avg 9.7 13.9
Annual Turnover 36% -
Source: Factset and Russell®

Top 10 Holdings1

FirstCash Inc. 4.5%
Helen of Troy Ltd. 3.5%
Gildan Activewear Inc. 3.3%
Schweitzer-Mauduit Int’l Inc. 3.2%
TCF Financial Corp. 3.1%
AerCap Holdings NV 3.1%
Crown Holdings Inc. 2.7%
Colfax Corp. 2.6%
Omnicom Group Inc. 2.6%
Arrow Electronics Inc. 2.5%

Top 10 Holdings1

FirstCash Inc. 4.5%
Helen of Troy Ltd. 3.5%
Gildan Activewear Inc. 3.3%
Schweitzer-Mauduit Int’l Inc. 3.2%
TCF Financial Corp. 3.1%
AerCap Holdings NV 3.1%
Crown Holdings Inc. 2.7%
Colfax Corp. 2.6%
Omnicom Group Inc. 2.6%
Arrow Electronics Inc. 2.5%

Sector Weights1

  • C&B Mid Cap Value
  • Russell Midcap® Value Index
  • Consumer Discretionary

    C&B Mid Cap Value
    17.2%
    Russell Midcap® Value Index
    11.8%
  • Consumer Staples

    C&B Mid Cap Value
    1.2%
    Russell Midcap® Value Index
    3.9%
  • Energy

    C&B Mid Cap Value
    1.2%
    Russell Midcap® Value Index
    8.1%
  • Financials

    C&B Mid Cap Value
    24.1%
    Russell Midcap® Value Index
    21.0%
  • Health Care

    C&B Mid Cap Value
    9.0%
    Russell Midcap® Value Index
    6.4%
  • Industrials

    C&B Mid Cap Value
    20.2%
    Russell Midcap® Value Index
    12.1%
  • Information Technology

    C&B Mid Cap Value
    9.8%
    Russell Midcap® Value Index
    6.7%
  • Materials

    C&B Mid Cap Value
    11.2%
    Russell Midcap® Value Index
    5.6%
  • Real Estate

    C&B Mid Cap Value
    1.6%
    Russell Midcap® Value Index
    13.6%
  • Telecommunication Services

    C&B Mid Cap Value
    Russell Midcap® Value Index
    0.5%
  • Utilities

    C&B Mid Cap Value
    Russell Midcap® Value Index
    10.2%
  • Cash

    C&B Mid Cap Value
    4.5%
    Russell Midcap® Value Index
Source: Factset and Russell®

Market Commentary

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After delivering nine consecutive quarters of positive returns, U.S. equities, as measured by the S&P 500 Index, delivered the first quarter of negative returns since the third quarter of 2015. Volatility also returned during the first quarter. In 2017, there were eight days in which the S&P 500 advanced or declined more than 1%. In the first quarter of 2018, there were 23.

The Russell Midcap® Value Index fell 2.50% in 1Q. Declines, while not dramatic, were broad-based with most sectors posting negative returns with the exception of Information Technology, Telecommunication Services, and Financials.

Additional Cooke & Bieler Mid Cap Value Disclosures