SMID Cap Value Q4 2019


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40 to 50

companies in our fully invested, concentrated portfolio

15

year track record

$29

million SMID Cap Value assets under management as of 12/31/2019

105%

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 4 2019

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell 2500™ 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 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**
12.6% 7.0x 2.8x 15.1x 13.7x
7.2% 5.3x 3.3x 20.2x -
ROC 5 Year Avg 12.6% 7.2%
Cash Interest Coverage 7.0x 5.3x
Debt/EBITDA 2.8x 3.3x
Forecasted P/E** 15.1x 20.2x
P/Normalized Earnings** 13.7x -
Period Ending: 12.31.2019 * 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
46 0.9 - 20.6 6.1 35%
1,804 0.03 - 13.8 5.4 -
# Holdings 46 1,804
Market Cap ($B) Range 0.9 - 20.6 0.03 - 13.8
Market Cap ($B) Wtd Avg 6.1 5.4
Annual Turnover 35% -
Source: Factset and Russell®

Top 10 Holdings1

Winnebago Industries 5.0%
TCF Financial 3.7%
Arrow Electronics 3.4%
Helen of Troy 3.4%
AerCap Holdings 3.0%
Syneos Health 3.0%
Schweitzer-Mauduit International 2.9%
Gildan Activewear 2.9%
American Eagle Outfitters 2.7%
Amdocs 2.5%

Top 10 Holdings1

Winnebago Industries 5.0%
TCF Financial 3.7%
Arrow Electronics 3.4%
Helen of Troy 3.4%
AerCap Holdings 3.0%
Syneos Health 3.0%
Schweitzer-Mauduit International 2.9%
Gildan Activewear 2.9%
American Eagle Outfitters 2.7%
Amdocs 2.5%

Sector Weights1

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

    C&B SMID Cap Value
    Russell 2500™ Value Index
    3.1%
  • Consumer Discretionary

    C&B SMID Cap Value
    17.9%
    Russell 2500™ Value Index
    10.1%
  • Consumer Staples

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

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

    C&B SMID Cap Value
    17.5%
    Russell 2500™ Value Index
    23.6%
  • Health Care

    C&B SMID Cap Value
    10.6%
    Russell 2500™ Value Index
    5.9%
  • Industrials

    C&B SMID Cap Value
    26.8%
    Russell 2500™ Value Index
    13.3%
  • Information Technology

    C&B SMID Cap Value
    11.0%
    Russell 2500™ Value Index
    9.3%
  • Materials

    C&B SMID Cap Value
    9.5%
    Russell 2500™ Value Index
    6.3%
  • Real Estate

    C&B SMID Cap Value
    2.0%
    Russell 2500™ Value Index
    14.8%
  • Utilities

    C&B SMID Cap Value
    Russell 2500™ Value Index
    5.8%
  • Cash

    C&B SMID Cap Value
    4.7%
    Russell 2500™ 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 2500™ Value Index (R25IV) generated an 7.07% 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 SMID Cap Value Disclosures