Heartland Opportunistic Value Equity Strategy

  • Overview
  • Materials
  • Portfolio Management Team
  • Performance
  • Commentary
  • Portfolio Composition
  • Risk Analysis

Overview

Investment Focus

Dynamically pursues the best opportunities regardless of market capitalization

Distinguishing Characteristics

  • Multi-cap portfolio that typically invests in stocks with market capitalization of $500 million or greater
  • Designed for investors who seek diversification through an all-cap approach
  • Benchmarked to the Russell 3000® Value Index
  • Typically holds 30-50 stocks
  • Inception date: 1999

Investment Minimum & Standard Fee Schedule

Minimum: $500,000

Account SizeAnnual Rate (%)
First $5 million1.00
Next $10 million0.85
Above $15 millionNegotiable

Investment Process

All stocks are evaluated based on our proprietary, consistent, and time-tested 10 Principles of Value Investing™. These criteria are central to Heartland’s value investing philosophy and provide a framework for evaluating securities.

The Investment Team applies a bottom-up research approach, combining traditional fundamental analysis and meetings with more than 1,000 company management teams in a typical year. The 10 Principles™ are designed to help the Team assess a company's valuation, but also focus on metrics associated with financial soundness, management team strength, and future outlook.

Learn more about our process

Portfolio Management Team

Heartland Opportunistic Value Equity Strategy

32 years of industry experience
21 years of experience at Heartland

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Will Nasgovitz

Nasgovitz is CEO and Portfolio Manager of the Select Value and Mid Cap Value Funds and their corresponding separately managed account strategies. He also is CEO of Heartland Funds. He has 17 years of industry experience, 13 at Heartland.

Colin McWey

McWey, CFA, is Vice President and Portfolio Manager of the Select Value and Mid Cap Value Funds and their corresponding separately managed account strategies. He has 15 years of industry experience, 8 at Heartland.

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Investing Perspectives

Water & Wells
8/29/17
Heartland Advisors Value Investing Portfolio Manager and CEO Will Nasgovitz

Oops! Did They Do it Again?

The meteoric rise of a handful of stocks may have investors forgetting lessons learned from the tech bubble of the late 1990s.

Video
7/17 - 4:03
Heartland Advisors value investing portfolio manager Will Nasgovitz

Here's What's Missing in the Energy Debate

Why the current slump in Energy requires a fresh perspective.

Water & Wells
5/23/17
Heartland Advisors Value Investing Portfolio Manager and CEO Will Nasgovitz

No More Earnings on the Cheap?

Why companies may no longer be able to rely on reduced capital expenditures to boost profit margins.

PM Perspective
5/17
Heartland Advisors value investing portfolio manager Colin McWey

Cash Flow: An Equalizing Force in Analysis

Cash flow helps us evaluate opportunities on an apples to apples basis regardless of industry or debt.

Video
5/17 - 3:55
Heartland Advisors value investing Investment Team members

Trends in Insider Activity

What insider activity is telling us about today's market.

PM Perspective
4/17
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Why Catalysts and Context Matter

The difference between an unloved laggard and an attractive investment opportunity often begins with perception. Here is a look at internal catalysts and their importance in changing investors’ views and company results.

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Heartland in the News
4/25/17
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Why Backing Winners Could be a Losing Formula

Portfolio Manager Colin McWey, CFA, talks with MarketWatch about potential pitfalls in today’s crowded trades.

Heartland in the News
4/21/17
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Circling the Wagon: What Colin McWey, Buffett & Others See in Wells Fargo

MarketWatch asks Portfolio Manager Colin McWey, CFA, for his take on a Warren Buffett* favorite stock.

Heartland in the News
4/6/17
Heartland Advisors Value Investing Portfolio Manager Colin McWey

‘There’s More Bull To Be Had’

Portfolio Manager Colin McWey, CFA, weighs in on whether the bull market has more room to run despite inflated stock prices.​

Heartland in the News
2/22/17
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Leveraging our Disciplined Approach

Sure a rising tide can lift all boats, but we’re ‘creating our own luck,' explains Portfolio Manager Colin McWey, CFA.

PM Perspective
2/17
Heartland Advisors value investing portfolio manager Will Nasgovitz

What’s in Your Index?

A look at how passive investing may be adding unwanted risk to your portfolio.

Water & Wells
2/7/17
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

Corporate America’s Doping Problem

History has been unforgiving for companies that bulk up on debt.

Heartland in the News
1/16/17
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

At the Intersection of Art & Science

A look at how both influence our quest for value.

Water & Wells
12/14/16
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

Will High-Yielding Companies Get Lost on the Hike?

A look at how the latest Fed rate hike may play out for dividend paying stocks.

Heartland in the News
11/12/16
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Barron's Highlights Heartland Analysis of Dividend-Paying Stocks

Portfolio Manager Colin McWey, CFA, discusses the year-to-date disparity in performance between high-yielding stocks and the rest of the pack. Our view: investors have focused too much on absolute yield, creating opportunity for managers focused on fundamentals.

Heartland in the News
10/5/16
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Retail Stocks: A Mixed Bag

There are too many brands, too much competition, and not enough demand, says Portfolio Manager Colin McWey, CFA. Yet, a closer look yields a handful of names with attractive valuations and compelling catalysts.

Performance*

Average Annual Total Returns
  • Quarter-End
  • Annual
6/30/2017

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Since Inception (%)10-Year (%)5-Year (%)3-Year (%)1-Year (%)YTD (%)QTD (%)
Opportunistic Value Equity Composite (Net of Advisory Fees)**10.155.4112.244.9716.822.580.79
Opportunistic Value Equity Composite (Net of Bundled Fees)8.063.3710.062.9214.551.570.28
Russell 3000® Value7.095.5913.897.3216.214.321.29

 

2016 (%)

2015 (%)

2014 (%)

2013 (%)

2012 (%)

2011 (%)

2010 (%)

2009 (%)

2008 (%)

2007 (%)

2006 (%)

2005 (%)

Opportunistic Value Equity Composite (Net of Advisory Fees)**

18.83 -4.05

4.02

34.59

13.43

-7.88

17.51

35.82

-32.38

4.62

13.93

14.90

Opportunistic Value Equity Composite (Net of Bundled Fees)

16.52 -5.92

1.99

32.00

11.25

-9.70

15.24

33.23

-33.64

2.62

11.80

12.80

Russell 3000® Value

18.40 -4.13

12.70

32.69

17.55

-0.10

16.23

19.76

-36.25

-1.01

22.34

6.85

 

*Source: FactSet Research Systems, Inc., Russell Investment Group, and Heartland Advisors, Inc. Performance data is preliminary. YTD and QTD returns are not annualized. The Strategy's inception date is 9/30/1999.
**Shown as supplemental information.

Commentary

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6/30/17
Heartland Opportunistic Value Equity Strategy Portfolio Manager Commentary

Heartland Opportunistic Value Equity Strategy 2Q17 Portfolio Manager Commentary

Investors responded to a murky economic outlook by gravitating toward growth-oriented names, defensive areas, and larger businesses.

Portfolio Composition

Characteristics
6/30/2017

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Weighted Average Market Cap ($)Median Market Cap ($)Trailing 1-Year Turnover (%)
Opportunistic Value Equity Composite80.6 billion13.9 billion53.0
Russell 3000® Value106.1 billion1.5 billion-

Source: FactSet Research Systems Inc., Russell Investment Group, and Heartland Advisors, Inc.

Valuation Analysis
Equity securities only, weighted median unless otherwise noted

6/30/2017

Source: FactSet Research Systems Inc., Russell Investment Group, and Heartland Advisors, Inc.
*Weighted average

Heartland Opportunistic Value Equity Strategy valuations 1Heartland Advisors Opportunistic Value Equity Strategy Valuation Analysis Charts 2

 

Sector Allocation

6/30/2017

Source: FactSet Research Systems Inc., and Russell Investment Group
Composite statistics shown as percentage of equity investments

Heartland Advisors Opportunistic Value Equity Strategy Sector Charts 1Heartland Advisors Opportunistic Value Equity Strategy Sector Charts 2

Top 10 Holdings in a Representative Account
6/30/2017

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TickerHolding% of AccountIndustry
BRK/BBerkshire Hathaway Inc Class B4.42Diversified Financial Services
XOMExxon Mobil Corporation3.90Oil Gas & Consumable Fuels
WFCWells Fargo & Company3.61Commercial Banks
AXPAmerican Express Company3.29Consumer Finance
CACA, Inc.3.19Software
WMTWal-Mart Stores, Inc.3.11Food & Staples Retailing
EQCEquity Commonwealth3.03Equity Real Estate Investment Trusts (REITs)
EXCExelon Corporation3.02Electric Utilities
GTSTriple-S Management Corporation2.98Health Care Providers & Services
ESRXExpress Scripts Holding Company2.92Health Care Providers & Services
% of Total Net Assets33.47

Attribution & Contribution

6/30/2017

These materials are for financial professional use only. You will be prompted to log in. Free account registration is available.

5-Year Risk Analysis

6/30/2017

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Alpha*Standard Deviation (%)*BetaInfo RatioSharpe RatioUpside Capture (%)*Downside Capture (%)*R-
Squared (%)
Active Share
Opportunistic Value Equity Composite (Net of Advisory Fees)-2.1711.421.06-0.381.0697.61111.6786.0289.01
Russell 3000® Value0.009.951.000.001.38100.00100.00100.000.00

*Annualized
Source: FactSet Research Systems Inc., Russell Investment Group
Alpha, beta, and information ratio are versus the Russell 3000® Value Index.

The above performance, portfolio composition, and risk analysis data is preliminary.

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These email lists are created for use by U.S. investment professionals only and are published strictly for informational purposes. Providing access to the content of these emails does not explicitly or implicitly constitute a solicitation of services or products of Heartland Advisors, Heartland Funds, or any of their affiliates. The information contained in these emails is not intended for distribution to, or for use by, investment professionals in a jurisdiction where distribution or purchase is not authorized. The information contained in these emails is not appropriate for use by individual investors. By registering for any of these emails, you agree to Heartland’s terms and conditions and that you are qualified as an institutional investor or otherwise member of a registered broker/dealer, registered investment advisor, or investment consulting firm.
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©2017 Heartland Advisors | 789 N. Water Street, Suite 500, Milwaukee, WI 53202 | Business Office: 414-347-7777 | Financial Professionals: 888-505-5180 | Individual Investors: 800-432-7856

As of 3/31/2017, Heartland Advisors on behalf of its clients held approximately 0.01% of the total shares outstanding of Wells Fargo & Co.

Past performance does not guarantee future results. Performance represents past performance, and current returns may differ.

Heartland Advisors, Inc. (the "Firm") claims compliance with the Global Investment Performance Standards (GIPS®). The Firm is a wholly owned subsidiary of Heartland Holdings, Inc., and is registered with the Securities and Exchange Commission. For a complete list and description of Heartland Advisors composites and/or a presentation that adheres to the GIPS® standards, contact the Institutional Sales Team at Heartland Advisors.

The U.S. dollar is the currency used to express performance.

The inception date for the Opportunistic Value Equity Strategy is 9/30/1999.

In addition to stocks of large companies, the Opportunistic Value Equity Strategy invests in stocks of small- and mid-cap companies that are generally less liquid than large companies. The performance of these holdings generally will increase the volatility of the strategy’s returns.

Value investments are subject to the risk that their intrinsic value may not be recognized by the broad market.

Portfolio holdings are subject to change without notice. Current and future portfolio holdings are subject to risk.

Sector and industry classifications as determined by Heartland Advisors may reference data from sources such as FactSet Research Systems, Inc. or the Global Industry Classification Codes (GICS) developed by Standard & Poor’s and Morgan Stanley Capital International.

Representative account chosen based on composite membership, not on performance-based criteria. Other accounts within the strategy may have different holdings.

Representative account holdings are preliminary, may not be reconciled, and may be updated when reconciled.

Certain security valuations and forward estimates are based on Heartland Advisors' calculations. Any forecasts may not prove to be true.

Economic predictions are based on estimates and are subject to change.

Heartland’s investing glossary provides definitions for several terms used on this page.

CFA® is a registered trademark owned by the CFA Institute.

Separately managed accounts and related investment advisory services are provided by Heartland Advisors, Inc., a federally registered investment advisor. ALPS Distributors, Inc., is not affiliated with Heartland Advisors, Inc.

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