Concentrated Value Q3 2020


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15 to 25

companies in our fully invested, concentrated portfolio

5

year track record

$31

million CV assets under management as of 9/30/2020

142%

upside market capture ratio since inception (7/1/15)

105%

downside market capture ratio since inception (7/1/15)

  • 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

    • Long-term/low turnover
    • Fully invested/limit on cash
  • Performance

    • Consistent pattern of results
    • Objective: Outperform the benchmark over the longer term

Concentrated Value

Quarter 3 2020

Equity Composite Performance

  • Cooke & Bieler - Gross of Fees
  • Cooke & Bieler - Net of Fees
  • Russell 3000® Value Index
Annualized Returns As of 9.30.2020 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 Concentrated Value Performance Disclosures

Quality Characteristics1

  • C&B Concentrated Value
  • Russell 3000® Value Index*
ROC 5 Year Avg Cash Interest Coverage Debt/EBITDA Forecasted P/E** P/Normalized Earnings**
13.9% 10.6x 2.5x 15.5x 10.7x
7.8% 6.6x 3.7x 22.8x -
ROC 5 Year Avg 13.9% 7.8%
Cash Interest Coverage 10.6x 6.6x
Debt/EBITDA 2.5x 3.7x
Forecasted P/E** 15.5x 22.8x
P/Normalized Earnings** 10.7x -
Period Ending: 9.30.2020 * Median ** Weighted Harmonic Mean Source: Factset and Russell®

Portfolio Attributes1

  • C&B Concentrated Value
  • Russell 3000® Value Index
# Holdings Market Cap ($B) Range Market Cap ($B) Wtd Avg Annual Turnover
22 1.7 - 391.9 68.7 58%
2,309 0.03 - 1,001.1 115.4 -
# Holdings 22 2,309
Market Cap ($B) Range 1.7 - 391.9 0.03 - 1,001.1
Market Cap ($B) Wtd Avg 68.7 115.4
Annual Turnover 58% -
Source: Factset and Russell®

Top 10 Holdings1

Chubb 7.0%
Arrow Electronics 5.9%
Brookfield Asset Management 5.9%
Johnson & Johnson 5.4%
Charles Schwab 5.3%
Philip Morris 5.1%
HCA Healthcare 4.9%
Progressive 4.9%
Gildan Activewear 4.8%
Essent Group 4.3%

Top 10 Holdings1

Chubb 7.0%
Arrow Electronics 5.9%
Brookfield Asset Management 5.9%
Johnson & Johnson 5.4%
Charles Schwab 5.3%
Philip Morris 5.1%
HCA Healthcare 4.9%
Progressive 4.9%
Gildan Activewear 4.8%
Essent Group 4.3%

Sector Weights1

  • C&B Concentrated Value
  • Russell 3000® Value Index
  • Communication Services

    C&B Concentrated Value
    3.5%
    Russell 3000® Value Index
    9.2%
  • Consumer Discretionary

    C&B Concentrated Value
    8.8%
    Russell 3000® Value Index
    7.9%
  • Consumer Staples

    C&B Concentrated Value
    5.1%
    Russell 3000® Value Index
    8.1%
  • Energy

    C&B Concentrated Value
    Russell 3000® Value Index
    4.0%
  • Financials

    C&B Concentrated Value
    41.3%
    Russell 3000® Value Index
    18.6%
  • Health Care

    C&B Concentrated Value
    17.7%
    Russell 3000® Value Index
    13.9%
  • Industrials

    C&B Concentrated Value
    10.9%
    Russell 3000® Value Index
    13.3%
  • Information Technology

    C&B Concentrated Value
    9.8%
    Russell 3000® Value Index
    9.5%
  • Materials

    C&B Concentrated Value
    Russell 3000® Value Index
    4.8%
  • Real Estate

    C&B Concentrated Value
    Russell 3000® Value Index
    4.9%
  • Utilities

    C&B Concentrated Value
    Russell 3000® Value Index
    5.9%
  • Cash

    C&B Concentrated Value
    2.9%
    Russell 3000® Value Index
Source: Factset and Russell®

Market Commentary

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U.S. equity markets continued higher in the third quarter on the heels of further government stimulus, improving economic data, encouraging readouts from COVID-19 vaccine trials, and better clinical outcomes for COVID-19 patients. Though the trend reversed in September, growth stocks again led the charge, with the Russell 3000® Growth Index up 12.86% for the three-month period versus 5.42% for the Russell 3000® Value Index.

Cooke & Bieler’s Concentrated Value Strategy returned 4.68% gross of fees (4.47% net of fees), underperforming the Russell 3000® Value Index for the quarter.

Additional Cooke & Bieler Concentrated Value Disclosures