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
22 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, 14 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

Heartland in the News
2/12/18
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Signs to Follow During the Market Detour

Portfolio Manager Colin McWey, CFA, was interviewed about whether the worst is over given recent volatility.

Water & Wells
2/6/18
Heartland Advisors Value Investing Portfolio Manager Colin McWey

Normal is Dead, Long Live Normal!

The return of volatility could provide opportunities for active investors going forward.

Heartland in the News
1/25/18
Heartland Advisors Value Investing CEO and Portfolio Manager Will Nasgovitz

Heartland CEO: Record Market Highs Haven’t Dried the River of Value

Will Nasgovitz was interviewed about the current environment for value investors.

Water & Wells
1/23/18
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

Value—it’s the Real Thing

Why the value versus growth debate is about more than the investment flavor of the day.

Video
12/17 - 3:05
Heartland Advisors Value Investing Portfolio Manager Will Nasgovitz

Follow at Your Own Risk

How ETF investors may be leaving money on the table in unloved sectors.

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.

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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.

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.

Performance*

Average Annual Total Returns
  • Quarter-End
  • Annual
12/31/2017

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Since Inception (%)10-Year (%)5-Year (%)3-Year (%)1-Year (%)YTD (%)QTD (%)
Opportunistic Value Equity Composite (Net of Advisory Fees)**10.487.4212.659.0113.6313.636.07
Opportunistic Value Equity Composite (Net of Bundled Fees)8.375.3410.456.8911.4011.405.57
Russell 3000® Value7.377.1913.958.7113.1913.195.08

 

2017 (%) 2016 (%)

2015 (%)

2014 (%)

2013 (%)

2012 (%)

2011 (%)

2010 (%)

2009 (%)

2008 (%)

2007 (%)

2006 (%)

2005 (%)

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

13.63 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)

11.40 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

13.19 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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12/31/17
Heartland Opportunistic Value Equity Strategy Portfolio Manager Commentary

Heartland Opportunistic Value Equity Strategy 4Q17 Portfolio Manager Commentary

Strong employment and economic data, and new tax legislation led the major indices to new highs during the period.

Portfolio Composition

Characteristics
12/31/2017

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Weighted Average Market Cap ($)Median Market Cap ($)Trailing 1-Year Turnover (%)
Opportunistic Value Equity Composite94.7 billion12.1 billion50.3
Russell 3000® Value117.2 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

12/31/2017

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

12/31/2017

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
12/31/2017

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TickerHolding% of AccountIndustry
BRK/BBerkshire Hathaway Inc Class B4.67Diversified Financial Services
SLBSchlumberger N.V. 4.06Energy Equipment & Services
XOMExxon Mobil Corporation3.65Oil Gas & Consumable Fuels
WFCWells Fargo & Company3.57Commercial Banks
ESRXExpress Scripts Holding Company3.48Health Care Providers & Services
WMTWal-Mart Stores, Inc.3.07Food & Staples Retailing
EXCExelon Corporation2.98Electric Utilities
CACA, Inc.2.78Software
ETREntergy Corporation2.73Electric Utilities
EQCEquity Commonwealth2.64Equity Real Estate Investment Trusts (REITs)
% of Total Net Assets33.63

Security-Level Attribution & Contribution

12/31/2017

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5-Year Risk Analysis

12/31/2017

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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)-1.8811.421.06-0.311.0999.47112.0186.6788.37
Russell 3000® Value0.009.991.000.001.37100.00100.00100.000.00

*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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©2018 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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