Heartland Mid Cap Value Strategy

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

Overview

Investment Focus

Seeks long-term appreciation by investing in mid-cap, dividend paying companies

Distinguishing Characteristics

  • Invests primarily in mid-cap securities within the market cap range defined by the Russell Midcap® Index
  • Designed for investors who seek a portfolio of medium-sized, dividend paying companies
  • Benchmarked to the Russell Midcap® Value Index
  • Typically holds 30-60 stocks
  • Inception date: 1996

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

Investment Minimum & Standard Fee Schedule

Minimum: $500,000

Account Size Annual Rate (%)
First $5 million 1.00
Next $10 million 0.85
Above $15 million Negotiable


A Look at Our Mid Cap Value Strategy

Mid Cap Value Strategy Quick Links

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Portfolio Management Team

Heartland Advisors Mid Cap Value Strategy Portfolio Management Team

36 years of industry experience
25 years of experience at Heartland

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Will Nasgovitz

Nasgovitz is CEO and Portfolio Manager of the Select Value, Mid Cap Value, and Value Funds and their corresponding separately managed account strategies. He also is CEO of Heartland Funds. He has 19 years of industry experience, 15 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 17 years of industry experience, 10 at Heartland.

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News & Investing Perspectives

Heartland in the News
10/7/19
Heartland Advisors Value Investing CEO Will Nasgovitz

Finding Opportunity in Volatility

Heartland CEO makes the case for an active, value-focused investment approach in response to elevated volatility.

Water & Wells
9/3/19
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

Debt: Harshing Market's Mellow?

Investors may be missing some key warning signs in their pursuit of low volatility.

Heartland in the News
8/27/19
Heartland Advisors CEO and Portfolio Manager Will Nasgovitz

Heartland’s Views Highlighted in Wealth Management Midyear Outlook

Heartland CEO Will Nasgovitz offers his take on why corporate borrowing may leave some investors out in the cold.

Water & Wells
7/23/19
Heartland Advisors Value Investing Portfolio Manager Colin McWey

A Tale of Two Tapes

Will the economy sputter or thrive? Yes.

Press Release
6/13/19
Heartland Advisors Mid Cap Value and Opportunistic Value Strategies Portfolio Management Team

Mid Cap, Opportunistic, Earn Repeat Recognition as “Top Guns”

Two Heartland Strategies continue to earn accolades relative to peers.

PM Perspective
5/19
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.

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PM Perspective
5/19

Cash Flow: An Equalizing Force in Analysis

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

Press Release
5/27/19

Heartland Mid Cap Value Fund PM Is ‘One to Watch,’ Say Industry Peers

Colin McWey, CFA, was selected as a "Rising Star" by Fund Intelligence, a national organization that seeks to identify investment professionals who are making meaningful contributions in the asset management industry.

Heartland in the News
4/3/19

Time to Focus on What Matters

CEO Will Nasgovitz on the importance of balance sheets and fundamentals in today’s late-stage economic cycle.

Press Release
3/12/19

PM Colin McWey a Finalist for 2019 ‘Rising Stars’ Awards

The 2019 Mutual Fund Industry Awards are sponsored by Fund Intelligence.

Press Release
2/27/19

Mid Cap, Opportunistic Strategies Receive ‘Top Guns’ Recognition

Two Heartland Strategies honored for performance relative to peers.

Heartland in the News
2/21/19

Where Quality is On Sale: PM Offers Views to U.S. News

Colin McWey, CFA, offers insights on some high-quality businesses trading at discounts.

Heartland in the News
2/20/19

MarketWatch Highlights Heartland CEO’s $3 Trillion Warning

Will Nasgovitz looks at how the surge in corporate debt coming due could impact the market.

Water & Wells
2/19/19

A $3 Trillion Time Bomb?

A look at the tsunami of corporate debt that could swamp companies over the next five years.

Performance*

Average Annual Total Returns
  • Quarter-End
  • Annual
9/30/2019

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Since Inception (%)10-Year (%)5-Year (%)3-Year (%)1-Year (%)YTD (%)QTD (%)
Mid Cap Value Composite (Net of Advisory Fees)11.2111.437.748.810.5816.17-0.44
Russell Midcap® Value10.3512.297.557.821.6019.471.22

 

2018 (%) 2017 (%) 2016 (%)

2015 (%)

2014 (%)

2013 (%)

2012 (%)

2011 (%)

2010 (%)

2009 (%)

2008 (%)

2007 (%)

2006 (%)

2005 (%)

Mid Cap Value Composite (Net of Advisory Fees)

-8.26 8.55 28.25

-6.64

10.78

39.46

10.49

-7.72

25.29

35.14

-22.19

5.13

24.10

18.41

Russell Midcap® Value

-12.29 13.34 20.00

-4.78

14.75

33.46

18.51

-1.38

24.75

34.21

-38.44

-1.42

20.22

12.65

 

*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 9/30/1996.

Commentary

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9/30/19
Heartland Advisors Mid Cap Value Strategy Portfolio Manager Commentary

Heartland Mid Cap Value Strategy 3Q19 Portfolio Manager Commentary

An uncertain outlook led to a volatile quarter for equities, yet the major indices ended the period up modestly.

Portfolio Composition

Characteristics
9/30/2019

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Weighted Average Market Cap ($)Median Market Cap ($)Trailing 1-Year Turnover (%)
Mid Cap Value Composite11.8 billion7.9 billion54.1
Russell Midcap® Value15.1 billion7.6 billion-

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

Valuation Analysis
Equity securities only, weighted harmonic average unless otherwise noted

9/30/2019

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

Heartland Advisors Mid Cap Value Strategy Valuation Analysis Charts 1Heartland Advisors Mid Cap Value Strategy Valuation Analysis Charts 2

Sector Allocation

9/30/2019

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

Heartland Advisors Mid Cap Value Strategy Sector Charts 1Heartland Advisors Mid Cap Value Strategy Sector Charts 2

Top 10 Holdings in a Representative Account
9/30/2019

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TickerHolding% of AccountIndustry
EXCExelon Corp.4.87Electric Utilities
DGXQuest Diagnostics, Inc.4.76Health Care Providers & Services
BPOPPopular, Inc.4.30Banks
MANManpowerGroup, Inc.3.74Professional Services
FHNFirst Horizon National Corp.3.57Banks
RGAReinsurance Group of America, Inc.3.30Insurance
MDUMDU Resources Group, Inc.3.21Multi-Utilities
AVTAvnet, Inc.3.07Electronic Equipment Instruments & Components
UMBFUMB Financial Corp3.05Banks
STTState Street Corp.2.90Capital Markets
% of Total Net Assets36.77

Security-Level Attribution & Contribution

9/30/2019

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5-Year Risk Analysis

9/30/2019

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Alpha*Standard Deviation (%)*BetaInfo RatioSharpe RatioUpside Capture (%)*Downside Capture (%)*R-
Squared (%)
Active Share
Mid Cap Value Composite (Net of Advisory Fees)-0.0813.771.050.040.49107.75109.0291.0992.68
Russell Midcap® Value0.0012.511.000.000.53100.00100.00100.000.00

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

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

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©2019 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

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 Mid-Cap Value Strategy is 9/30/1996.

The Mid Cap Value Strategy invests in mid–sized companies on a value basis. Mid-sized securities generally are more volatile and less liquid than those of larger companies.

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 are sourced from GICS®.The Global Industry Classification Standard (GICS®) is the exclusive intellectual property of MSCI Inc. (MSCI) and S&P Global Market Intelligence (“S&P”).  Neither MSCI, S&P, their affiliates, nor any of their third party providers (“GICS Parties”) makes any representations or warranties, express or implied, with respect to GICS or the results to be obtained by the use thereof, and expressly disclaim all warranties, including warranties of accuracy, completeness, merchantability and fitness for a particular purpose.  The GICS Parties shall not have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of such damages.

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. Certain outliers may be excluded. 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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