Alma Hotchkis & Wiley US Large Cap Value Equity Fund

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Overview

  • Alma Hotchkis & Wiley US Large Cap Value Equity Fund seeks current income and long-term capital growth by investing in a concentrated portfolio of undervalued large US companies.
  • Management of the fund is delegated to Hotchkis & Wiley LLC.

Share Class

NAV

Cumulative Performance (%)

Fund Inception 6 August 2014

Daily Monthly Ytd 1Yr 3Yr 5Yr Incept. Incept.Date

The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.


Strategy & Manager

Funds Strategy

Investment objective: to seek current income and long-term capital growth by investing in a concentrated portfolio of large US companies

  • Investment process: analyse long term company fundamentals through in-house bottom-up research aiming to identify undervalued stocks
  • The fund typically holds 40 to 60 securities and generally invests in companies with a market capitalization above $ 3billion
  • Benchmark: Russell 1000 Value Index


Investment Manager

Hotchkis & Wiley is an SEC-regulated, Los Angeles-based investment adviser founded in 1980, specialized in US value equity and US high yield bond strategies.

  • Interests aligned with investors: Hotwhkis & Wiley is an employee owned firm– all 21 investment professionals own equity
  • George Davis, the CEO of Hotchkis & Wiley and senior portfolio manager of the fund, has over 30 years of investment experience. He coordinates the day-to-day management of around $27 billion of equity value assets
  • Hotchkis & Wiley manage $31billion

Key Persons

George Davis, Jr. CEO, Portfolio Manager and Principal

Mr. Davis became CEO in 2001. In his role as portfolio manager, Mr. Davis plays an integral part in the investment research review and decision-making process.  He coordinates the day-to-day management of Large Cap Fundamental Value and Large Cap Diversified Value portfolios, as well as represents the firm’s investment strategies to current and prospective clients. He also provides expertise and insight into the capital goods and financials sectors. Prior to joining the firm, Mr. Davis was an assistant to the senior partner of RCM Capital Management. He began his career in equity research with internships at Cramer, Rosenthal & McGlynn and Fidelity Management & Research.

Mr. Davis received his BA in Economics and History and MBA from Stanford University.

 

Scott McBride, CFA Portfolio Manager and President

Mr. McBride became President of Hotchkis & Wiley in 2016. In his role as portfolio manager, Mr. McBride plays an integral part in the investment research review and decision-making process. He coordinates the day-to-day management of Large Cap Fundamental Value, Large Cap Diversified Value, Global Value and International Value portfolios, as well as represents these strategies to current and prospective clients. He also provides expertise and insight into the consumer, financials, healthcare and technology sectors. Prior to joining the firm, Mr. McBride was an associate consultant with Deloitte Consulting and worked as an investment marketing analyst with Fidelity Investments.

 

Patrick Meegan, CPA Portfolio Manager

In his role as portfolio manager, Patrick Meegan plays an integral role in the investment research review and decision-making process. He coordinates the day-to-day management of all High Yield bond and Capital Income portfolios. He also provides expertise and insight into the financials and healthcare sectors. Mr. Meegan began his career at H&W as an investment analyst and became portfolio manager in 2001. Prior to joining the firm, Mr. Meegan was an audit manager at Arthur Andersen and specialized in financial statement audits and advising clients on SEC reporting issues.

Mr. Meegan, a Certified Public Accountant, received his BA in Business Administration with honors from California State University, Fullerton and his MBA with honors from the Anderson School of Management at the University of California, Los Angeles.

 

Judd Peters, CFA Portfolio Manager

In his role as portfolio manager, Mr. Peters plays an integral part in the investment research review and decision-making process. He coordinates the day-to-day management of Large Cap Fundamental Value, Large Cap Diversified Value, Small Cap Diversified Value and Global Value portfolios, as well as represents these strategies to current and prospective clients. He also provides expertise and insight into the capital goods, energy and technology sectors. Prior to joining the firm, Mr. Peters was an analyst in the corporate finance department of an investment banking firm.

 

Patty McKenna, CFA Portfolio Manager and Principal

In her role as portfolio manager, Ms. McKenna plays an integral part in the investment research review and decision-making process and represents the firm’s investment strategies to current and prospective clients. She also provides expertise and insight into the consumer and healthcare sectors. Prior to joining the firm, Ms. McKenna was an equity analyst at Trust Company of the West. Before entering the field of investment management, she has worked for five years in corporate finance at Bankers Trust and then at Fieldstone Private Capital Group. Ms. McKenna began her career as a forensic accountant in 1983.

 

Sheldon Lieberman Portfolio Manager and Principal

In his role as portfolio manager, Mr. Lieberman plays an integral part in the investment research review and decision-making process and represents the firm’s investment strategies to current and prospective clients. He also provides expertise and insight into the energy and technology sectors. Prior to joining the firm, Mr. Lieberman was the chief investment officer for the Los Angeles County Employees Retirement Association (“LACERA”). At LACERA, he was responsible for overseeing the fund’s investment activity, as well as developing and implementing investment policy, strategy and guidelines. Prior to his position at LACERA, he was manager of trust investments at Lockheed Corporation.


Statistics & Commentary

Performance

The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.

Sector Breakdown as a % of AUM

as of 30/04/2019

Portfolio Characteristics

as of 30/04/2019
Main indicators Fund Index
No. of securities 50 721
Weighted Average Market Cap ($bn) 114.3 123.8
Median Market Cap ($bn) 35.9 9.6
Projected P/E Ratio 11.0x 13.6x
Price/ Normal Earnings 8.7x 14.7x
Price/ Book 1.5x 2.1x
Price/ Sales 1.1x 1.6x
Projected EPS Growth 6.0x 5.6x
Active share (%) 82.7 -

Top 10 Position Details

as of 30/04/2019
Security name Sector % AUM
American International Group Financials 5.15
General Electric Co Industrials 4.31
Citigroup Inc Financials 4.20
Microsoft Corp Information Technology 4.16
Wells Fargo & Co Financials 4.06
Goldman Sachs Group Inc Financials 3.17
General Motors Co Consumer Discretionary 3.17
Hewlett Packard Enterprise Information Technology 3.07
Discovery Inc-C Communication Services 2.76
Oracle Corp Information Technology 2.75

Investment Manager's Commentary

as of 30/04/2019

Market Review and Outlook

The S&P 500 Index returned +4.1% in April. The steady and rapid market rebound that began in late December continued nearly unabated, with
both the S&P 500 Index and NASDAQ reaching new record highs. The S&P 500 Index is now up over 18% since the beginning of the year, making
this one of the strongest starts to the year in history. Every S&P 500 Index sector is up year-to-date, and every sector besides health care is up more than +10%. Growth outperformed value in April, extending its year-to- date advantage to 5.4% (+21.3% vs. +15.9%). In general, the US equity market appears fully valued. However, we continue to find interesting valuation opportunities in certain segments of the market. We are partial to financials, technology, industrials, and energy, all of which contain attractive valuation opportunities for the risks at hand. As a result, the portfolio continues to trade at a significant valuation discount to the value benchmark: 1.5x book value and 8.7x normal earnings compared to 2.1x and 14.7x, respectively, for the Russell 1000 Value Index. The portfolio trades at a tremendous discount to the broad benchmark: the S&P 500 Index trades at 3.4x book value and 18.3x normal earnings.

Fund

The fund outperformed the Russell 1000 Value Index in the first quarter of 2019. Positive stock selection drove about 85% of the outperformance in the quarter, with the balance coming from favorable sector allocation. Positive stock selection in financials and energy were the largest contributors. The underweight position in healthcare and overweight position in technology were more modest positive contributors. On the negative side, the overweight in financials and underweight in real estate detracted from performance along with stock selection in consumer discretionary and technology. The largest positive contributors to relative performance in the quarter were General Electric, Hess, Apache, Hewlett Packard Enterprise, and Murphy Oil; the largest detractors were Vodafone, Adient, State Street, Wells Fargo, and Embraer.


Facts & Documents

Facts

Fund Domicile: Luxembourg

Management Fee: 0.75% p.a. for I shares

Fund Type: UCITS SICAV

Fund Launch: 6 August 2014

Base Currency: USD

Depositary, Administrator, Transfert Agent: BNP Paribas Securities Services (LU)

Dealing: Each day with a 1-day notice

Cut-off time: 5 pm CET

Management Company: Alma Capital Investment Management

Investment Manager: Hotchkis & Wiley Capital Management, LLC (US)

Fund Managers: George Davis, Scott McBride, Judd Peters, Patty Mckenna, Sheldon Lieberman, Patrick Meegan

Countries where the fund is registered:
France, Germany, Luxembourg, Switzerland, United Kingdom, Austria

Identifiers:

Institutional USD Capitalisation share class
ISIN: LU0963547111   Ticker: ALDCPBI LX    Launch: 6 Aug 2014

Retail USD Capitalisation share class
ISIN: LU0963547970   Ticker: ALDCBRU LX    Launch: 21 Nov 2017

Documents

SICAV ALMA CAPITAL INVESTMENT FUNDS
  1. ACIF Prospectus