Small Cap Value Q4 2019


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40 to 60

companies in our fully invested, concentrated portfolio

11

year track record

$1.7

billion Small Cap Value assets under management as of 12/31/2019

112%

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

77%

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 2019

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell 2000® Value Index
Annualized Returns As of 12.31.2019 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 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**
12.5% 7.8x 2.5x 16.4x 13.6x
6.7% 5.1x 3.3x 23.4x -
ROC 5 Year Avg 12.5% 6.7%
Cash Interest Coverage 7.8x 5.1x
Debt/EBITDA 2.5x 3.3x
Forecasted P/E** 16.4x 23.4x
P/Normalized Earnings** 13.6x -
Period Ending: 12.31.2019 * 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
45 0.8 - 8.7 4.0 40%
1,402 0.03 - 6.8 2.2 -
# Holdings 45 1,402
Market Cap ($B) Range 0.8 - 8.7 0.03 - 6.8
Market Cap ($B) Wtd Avg 4.0 2.2
Annual Turnover 40% -
Source: Factset and Russell®

Top 10 Holdings1

Winnebago Industries 4.7%
TCF Financial 3.7%
Syneos Health 3.6%
Schweitzer-Mauduit International 3.3%
PGT Innovations 3.1%
Umpqua Holdings 3.1%
Helen of Troy 3.1%
American Eagle Outfitters 3.1%
Colfax 3.1%
Gildan Activewear 3.1%

Top 10 Holdings1

Winnebago Industries 4.7%
TCF Financial 3.7%
Syneos Health 3.6%
Schweitzer-Mauduit International 3.3%
PGT Innovations 3.1%
Umpqua Holdings 3.1%
Helen of Troy 3.1%
American Eagle Outfitters 3.1%
Colfax 3.1%
Gildan Activewear 3.1%

Sector Weights1

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

    C&B Small Cap Value
    Russell 2000® Value Index
    2.2%
  • Consumer Discretionary

    C&B Small Cap Value
    19.3%
    Russell 2000® Value Index
    9.7%
  • Consumer Staples

    C&B Small Cap Value
    Russell 2000® Value Index
    2.7%
  • Energy

    C&B Small Cap Value
    Russell 2000® Value Index
    5.8%
  • Financials

    C&B Small Cap Value
    20.0%
    Russell 2000® Value Index
    30.2%
  • Health Care

    C&B Small Cap Value
    9.5%
    Russell 2000® Value Index
    5.4%
  • Industrials

    C&B Small Cap Value
    31.0%
    Russell 2000® Value Index
    12.7%
  • Information Technology

    C&B Small Cap Value
    6.3%
    Russell 2000® Value Index
    9.6%
  • Materials

    C&B Small Cap Value
    8.6%
    Russell 2000® Value Index
    4.7%
  • Real Estate

    C&B Small Cap Value
    Russell 2000® Value Index
    11.1%
  • Utilities

    C&B Small Cap Value
    Russell 2000® Value Index
    5.9%
  • Cash

    C&B Small Cap Value
    5.2%
    Russell 2000® Value Index
Source: Factset and Russell®

Market Commentary

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U.S. equity markets ended the year on a very strong note, with indices reaching record highs. Investor optimism was buoyed by easing trade tensions and indications of diminishing recession risks. 

Against this backdrop, the Russell 2000® Value Index (RUJ) generated an 8.49% return. Notably, growth outperformed value and bond-proxy sectors underperformed the broader market. For the full year period, US equity indices – soothed by the Fed’s accommodative monetary policy pivot – were up broadly and significantly, posting returns upwards of 20%, with particular strength in Technology.

Additional Cooke & Bieler Small Cap Value Disclosures