Small Cap Value Q4 2018


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40 to 60

companies in our fully invested, concentrated portfolio

10

year track record

$834

million Small Cap Value assets under management as of 12/31/2018

110%

upside market capture ratio since inception (8/1/08)

78%

downside market capture ratio since inception (8/1/08)

  • 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

Small Cap Value

Quarter 4 2018

Equity Composite Performance

  • Cooke & Bieler - Gross of fees
  • Cooke & Bieler - Net of fees
  • Russell 2000® Value Index
Annualized Returns As of 12.31.2018 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 Small Cap Value Performance Disclosures

Quality Characteristics1

  • C&B Small Cap Value
  • Russell 2000® Value Index*
ROC 5 Year Avg Cash Interest Coverage Debt/EBITDA Forecasted P/E** P/Normalized Earnings**
10.7% 10.2x 2.3x 12.2x 10.2x
6.9% 5.3x 3.3x 16.0x -
ROC 5 Year Avg 10.7% 6.9%
Cash Interest Coverage 10.2x 5.3x
Debt/EBITDA 2.3x 3.3x
Forecasted P/E** 12.2x 16.0x
P/Normalized Earnings** 10.2x -
Period Ending: 12.31.2018 * Median ** Weighted Harmonic Mean Source: Factset and Russell®

Portfolio Attributes1

  • C&B Small Cap Value
  • Russell 2000® Value Index
# Holdings Market Cap ($B) Range Market Cap ($B) Wtd Avg Annual Turnover
42 0.3 - 6.3 2.8 36%
1,387 0.03 - 5.2 1.8 -
# Holdings 42 1,387
Market Cap ($B) Range 0.3 - 6.3 0.03 - 5.2
Market Cap ($B) Wtd Avg 2.8 1.8
Annual Turnover 36% -
Source: Factset and Russell®

Top 10 Holdings1

Gildan Activewear 4.6%
Steelcase 3.9%
Winnebago Industries 3.7%
Colfax 3.4%
PGT Innovations 3.2%
Woodward 3.1%
Reliance Steel & Aluminum 3.0%
Syneos Health 3.0%
Schweitzer-Mauduit 3.0%
TCF Financial 2.8%

Top 10 Holdings1

Gildan Activewear 4.6%
Steelcase 3.9%
Winnebago Industries 3.7%
Colfax 3.4%
PGT Innovations 3.2%
Woodward 3.1%
Reliance Steel & Aluminum 3.0%
Syneos Health 3.0%
Schweitzer-Mauduit 3.0%
TCF Financial 2.8%

Sector Weights1

  • C&B Small Cap Value
  • Russell 2000® Value Index
  • Communication Services

    C&B Small Cap Value
    Russell 2000® Value Index
    3.1%
  • Consumer Discretionary

    C&B Small Cap Value
    19.4%
    Russell 2000® Value Index
    9.4%
  • Consumer Staples

    C&B Small Cap Value
    Russell 2000® Value Index
    2.6%
  • Energy

    C&B Small Cap Value
    1.1%
    Russell 2000® Value Index
    5.4%
  • Financials

    C&B Small Cap Value
    18.6%
    Russell 2000® Value Index
    29.5%
  • Health Care

    C&B Small Cap Value
    10.1%
    Russell 2000® Value Index
    4.3%
  • Industrials

    C&B Small Cap Value
    29.6%
    Russell 2000® Value Index
    11.8%
  • Information Technology

    C&B Small Cap Value
    7.9%
    Russell 2000® Value Index
    10.7%
  • Materials

    C&B Small Cap Value
    8.4%
    Russell 2000® Value Index
    4.1%
  • Real Estate

    C&B Small Cap Value
    1.8%
    Russell 2000® Value Index
    11.7%
  • Utilities

    C&B Small Cap Value
    Russell 2000® Value Index
    7.3%
  • Cash

    C&B Small Cap Value
    3.1%
    Russell 2000® Value Index
Source: Factset and Russell®

Market Commentary

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U.S. equities performed poorly in the fourth quarter. What began as a modest pullback devolved into a market rout in December. In the end, it was the worst fourth quarter since 2008.

The Russell 2000® Value Index (RUJ) declined 18.67% in the fourth quarter. As tends to be the case in sudden, major pullbacks, selling pressure was widespread and largely indiscriminate.

Additional Cooke & Bieler Small Cap Value Disclosures