SMID Cap Value Q2 2019


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40 to 50

companies in our fully invested, concentrated portfolio

15

year track record

$23

million SMID Cap Value assets under management as of 6/30/2019

103%

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

93%

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 2019

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell 2500™ Value Index
Annualized Returns As of 6.30.2019 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 Forecasted P/E** P/Normalized Earnings**
12.5% 6.4x 2.9x 13.2x 12.2x
7.1% 5.1x 3.7x 17.1x -
ROC 5 Year Avg 12.5% 7.1%
Cash Interest Coverage 6.4x 5.1x
Debt/EBITDA 2.9x 3.7x
Forecasted P/E** 13.2x 17.1x
P/Normalized Earnings** 12.2x -
Period Ending: 6.30.2019 * 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
45 0.6 - 17.3 5.4 39%
1,701 0.002 - 16.8 5.2 -
# Holdings 45 1,701
Market Cap ($B) Range 0.6 - 17.3 0.002 - 16.8
Market Cap ($B) Wtd Avg 5.4 5.2
Annual Turnover 39% -
Source: Factset and Russell®

Top 10 Holdings1

Winnebago Industries 4.7%
Fidelity National Financial 3.3%
Arrow Electronics 3.2%
Reliance Steel & Aluminum 3.0%
Plexus 2.9%
Schweitzer-Mauduit International 2.9%
AerCap 2.9%
Helen of Troy 2.8%
American Eagle Outfitters 2.8%
Steelcase 2.6%

Top 10 Holdings1

Winnebago Industries 4.7%
Fidelity National Financial 3.3%
Arrow Electronics 3.2%
Reliance Steel & Aluminum 3.0%
Plexus 2.9%
Schweitzer-Mauduit International 2.9%
AerCap 2.9%
Helen of Troy 2.8%
American Eagle Outfitters 2.8%
Steelcase 2.6%

Sector Weights1

  • C&B SMID Cap Value
  • Russell 2500™ Value Index
  • Communication Services

    C&B SMID Cap Value
    Russell 2500™ Value Index
    3.2%
  • Consumer Discretionary

    C&B SMID Cap Value
    17.4%
    Russell 2500™ Value Index
    7.7%
  • Consumer Staples

    C&B SMID Cap Value
    Russell 2500™ Value Index
    3.0%
  • Energy

    C&B SMID Cap Value
    Russell 2500™ Value Index
    4.4%
  • Financials

    C&B SMID Cap Value
    17.9%
    Russell 2500™ Value Index
    23.3%
  • Health Care

    C&B SMID Cap Value
    10.9%
    Russell 2500™ Value Index
    5.3%
  • Industrials

    C&B SMID Cap Value
    25.9%
    Russell 2500™ Value Index
    14.2%
  • Information Technology

    C&B SMID Cap Value
    11.7%
    Russell 2500™ Value Index
    10.0%
  • Materials

    C&B SMID Cap Value
    12.1%
    Russell 2500™ Value Index
    5.8%
  • Real Estate

    C&B SMID Cap Value
    1.9%
    Russell 2500™ Value Index
    16.3%
  • Utilities

    C&B SMID Cap Value
    Russell 2500™ Value Index
    6.9%
  • Cash

    C&B SMID Cap Value
    2.2%
    Russell 2500™ Value Index
Source: Factset and Russell®

Market Commentary

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The second quarter was a bumpy ride for the U.S. stock market. The rally that began late last year continued through April, was upended in May by renewed concerns about the economy and a more protracted trade war, then was revived in June by the Fed’s clear pivot toward monetary easing.

The Russell 2500™ Value Index (R25IV) returned 1.89%, though only six of 11 economic sectors ended the quarter higher. Returns were strongest for large cap stocks, but otherwise underlying market dynamics lacked discernable themes.

Additional Cooke & Bieler SMID Cap Value Disclosures