Sunday, June 9, 2019

Marquette AIM Student-Managed Funds - Performance for the week ended 6/7/19

During the summer when the students are working at their internships, the AIM Funds are not actively managed. Here is how the funds performed for the most recent week ended June 7, 2019





Sunday, June 2, 2019

The Marquette AIM Small Cap Equity Fund Continues Strong YTD Investment Performance

Despite a Challenging Month, the Marquette AIM Small Cap Equity Fund is up 14.38% YTD versus 9.26% for the Benchmark (Russell 2000 Index). 

Check out the 1-, 3-, 5- and 10-Year Returns - impressive Performance!


The following is a complete listing of all AIM Small Cap Equity Funds holdings as of 5/31/2019 (click on the table below):









Marquette AIM International Equity Fund May 2019 Performance

Despite a Challenging Month, the Marquette AIM International Equity Fund is up 11.42% YTD versus 7.08% for the Benchmark (MSCI ACWI ex US Index)



The following is a complete listing of all AIM International Equity Funds holdings as of 5/31/2019:













Thursday, May 30, 2019

CFA Research Challenge 2019 Wrap-Up

Another Successful CFA Research Challenge Season 

The 13th season of the CFA Research Challenge was a record setting season with more than 6,200 students participating from across 1,100 universities and would not be possible without the hard work of our 4,000+ volunteers from across 161 societies and emerging societies. CFA Institute Logo

• Global Final and Asia Pacific Regional Champions: Ateneo de Manila University representing CFA Society Philippines 
• Americas Regional Final ChampionCanisius College (CFA Society Buffalo and CFA Society Rochester) 
• Americas Regional Final ChampionInstituto Tecnológico Autónomo de México (CFA Society Mexico) 
• EMEA Regional Final ChampionMoscow State University (CFA Association (Russia)) 
• EMEA Regional Final ChampionUniversity of Lausanne (CFA Society Switzerland)


Marquette's AIM Team in 2019 CFA Americas Challenge

This year Marquette participated for the 11th time in the Challenge - advancing to the Americas Regional Final for the 9th year.

Thanks to the CFA Institute for hosting this marvelous event.




Wednesday, May 29, 2019

AIM Alumnus Update, Vanessa Flotinger, Banker Associate at JP Morgan in NYC

Vanessa Foltinger: Your Training Regimen Reflects Your Higher Level Of Purpose

W680 vanessa foltinger runningThe D10 Athlete Profile explores what brings competitors to The D10 playing field...and what they bring away from it. 

Vanessa Foltinger
Associate, JP Morgan
The D10 NYC
Fundraising goal: Team Nicole's Army (15K)
2019 Marquee event: 800M Run (Goal: 3:00)

What is your primary motivator for competing in The D10 events?

Competition combined with fundraising for a worthy cause immediately caught my attention. I wanted to be a part of The D10 since the first time I was told about it.

How much of your motivation for participating in The D10 stems from its charitable mission?
The D10’s charitable mission is highly impactful. After meeting Dave Maloney, listening to his story, learning about his motivation and how he founded The D10, I was quite inspired. Growing up in Spain, I was part of Rotary International. I wanted to continue my involvement and participation in charitable giving in New York.

How did you first get involved in The D10?
I heard about The D10 through other former student-athletes working on Wall Street. The idea of competition combined with fundraising to help fight pediatric cancer intrigued me from the first mention. As I heard and read the individual stories of the different participants, I realized that most of us had similar experiences transitioning from student-athletes to highly demanding jobs and face similar difficulties to keep improving our athletic performance. When your purpose is to compete at a high level and raise more money for such a deserving charity, your training regimen will reflect that higher level of purpose and impact.

Thumb vanessa foltinger tennis
Vanessa Foltinger starred on the hardcourt for Marquette University tennis.

How has The D10 been different from your collegiate or high school sports experiences in terms of training and motivation?
The work life/training life balance is very similar to college as I balance hours in the office with hours I spend in the gym, the track, and other activities. Strength training and speed work are also very similar to the training we did for tennis. However, I find the conditioning training for The D10 (Tonehouse training for example) even harder than the three-hour long tennis matches I played in college. These are tough sessions!

Collegiate sports taught me the gratifying feeling of winning for my team, coaches and the University. The D10 is different as it taught me how to win for a worthy cause. 

In what ways has your participation in The D10 affected or enhanced your performance at work? 
I found that being part of The D10 is a great conversation starter at work. Many of my colleagues are curious to hear about The D10's success, its benevolent mission, and about the event itself on June 8th. 

Have you made new lasting friendships, or strengthened your professional network, as a result of your D10 experience?
One of my friends at work is now competing in The D10 as well. I maintain contact with friends who have left the company as well when we see each other at The D10 training and social events. It's an amazing network.

In her first year with The D10, Vanessa is committed to raising funds for pediatric cancer research. Help her with a performance-based donation to her results on June 8th after months and months of hardcore training. 

Sunday, May 19, 2019

The AIM program offers best wishes to Brian Till, Marquette's outgoing Dean of the College of Business


Brian Till, who has led the College of Business since 2015, will be stepping down today following Marquette’s graduation. He was a good friend of the AIM program.

Today (graduation day), Brian Till will step down as the James H. Keyes Dean of Business Administration, with plans to return to the faculty and take a yearlong sabbatical. Joe Daniels will become Marquette University’s dean of the College of Business Administration on May 20th.

David Krause, AIM program director, commented that Brian Till was always a strong supporter and good friend of the Applied Investment Management program. "Dean Till traveled with the students and me to New York City the past two years - he embedded with the students and made all of the visits with us over the three day stay in NYC. I look forward to working with Brian as he returns to the faculty."

Brian Till and David Krause

“For the past four years, I have truly enjoyed working with the faculty and staff of the College of Business Administration, and I love being a part of the Marquette community, and I’m very proud of all we have accomplished,” Till said. “Over the past few months, I have reflected on my personal and professional journey, and it became clear to me that now was the time to take a step back and discern what my next path will be. I want to thank everyone in the college for the support they’ve shown me and for the great work we have accomplished together.”
Dave Clark presents Brian Till at Dean's Reception
During his tenure, Till led the college through its renewed accreditation process, completed a strategic plan and developed a vision for the college to become a “destination business school,” the release said. He oversaw the launch of new undergraduate programs in commercial banking and sales, as well as the development of a new major in business analytics, and helped create the college’s Student-Run Business Program. He also oversaw the launch of an online cohort MBA program and a Masters in Supply Chain Management program.
Brian Till
“On behalf of the university community, I want to thank Dean Till for his leadership and service to the College of Business Administration and Marquette,” said Kimo Ah Yun, acting provost. “From the development of a strategic plan for the college to the launch of several new programs, Dean Till has moved the college forward and will pass the baton to the next Keyes Dean knowing the college is in excellent shape for the future.”
Till’s departure follows that of two other Marquette leaders, including former provost Dan Myers and Dave Lawlor, former executive vice president of operations.

The search for a permanent provost has begun and it will be followed by the search for a permanent Keyes Dean of Business Administration.



Saturday, May 18, 2019

Preakness 2019 - Krause's Selections

The 144th Preakness Stakes at Pimlico Race Course


For the first time since the early 1950's, the top 4 finishing horses in the Kentucky Derby will not be running in the Preakness Stakes. Here are Krause's selections:

Best Horse: #4 Improbable (5-2). This Baffert-breed horse was my Derby favorite and he remains the best horse in the field. Bumped badly coming out of the gates, he surged to a 5th place finish in the Derby - and this starting position is much more to his liking. 

Image result for improbable horse

Value Horse:  #2 Bourbon War (12-1).  Late closing horse should do well with a field of early runners. Was kept out of the Derby, so he is fresh and ready to gain late. Winner of two of his last five starts, he'll be in the money and might even be the surprise winner.


Image result for bourbon war horse


Solid Horse:  #5 Owendale (10-1)Another horse who skipped the Derby - he's had questionable finishes this year, but is well-bred. Experienced jockey, Florent Geroux, will also keep him off the pace - so look for Owendale to charge at the finish. 

Image result for owendale horse

Enjoy the Preakness...

Wednesday, May 15, 2019

A Current AIM International Equity Holding: Suncor Energy ($SU, $31.66): “Sunny in Alberta” By: Ben Schmidt, AIM Student at Marquette University


Suncor Energy ($SU, $31.66): “Sunny in Alberta”
By: Ben Schmidt, AIM Student at Marquette University



Disclosure: The AIM Equity Fund currently holds this position. This article was written by myself, and it expresses my own opinions. I am not receiving compensation for it and I have no business relationship with any company whose stock is mentioned in this article.

 Summary

Suncor Energy, Inc. (NYSE:SU) is a Canadian integrated energy company which develops petroleum resource basins through offshore oil and gas production, petroleum refining and product marketing.  

• Suncor achieved 98% upgrader utilization despite production curtailments by the Government of Alberta. Historically in the Oil Sands, only about 40% is upgraded into synthetic crude oil (SCO).

• Total upstream production was 764.3 thousand barrels of oil equivalent per day (kboe/d), up from 689.4 (kboe/d) in 4Q2018. Total Oil Sands production was 657,200 barrels per day (bbls/d), compared to 571,700 bbls/d in the prior year quarter.

• Despite weak oil prices in the back half of FY2018 and early FY2019, SU still delivered $2.6 billion of cash from funds from operations in 1Q2019.

• They delivered $662 million in dividends to shareholders while also buying back $514 million of common shares in the first quarter of 2019.

Key points: 

In early December, the government in Alberta decided to impose production cuts of 325k barrels per day in response to a widening differential of the Western Canadian Select (WCS) to the WTI. This is largely attributable to the lack of takeaway capacity in Canada. As SU continues to produce more oil YoY, they have been realizing prices at lower than historical prices.  

Due to the large overcorrection in differentials, Alberta began easing up on production curtailments. This decision ultimately raised their realizable prices per barrel which translated into positive Net Income of $1.5 billion, up from ($212 million) in 4Q2018. Despite the increases in Net Income, cash operation costs in the Oil Sands rose $3.10 per barrel to $29.95 largely in part to the production curtailments. Moving forward, as production activity increases and economies of scale takes place, these costs should start to trend down towards historical averages. Suncor expects these curtailments to trend closer to 175 kboe/d by June, allowing them to get in line with their 2019 guidance. Once this happens, they will begin working on optimizing their asset performance and safety to deliver stronger performance for the rest of FY2019. Furthermore, SU’s BOD approved a 17% dividend increase on ~ 1.7 billion and up to $2.0 billion for share repurchases on an annual basis.

On April 19th, the United Conservative Party of Alberta formed a ruling majority with 63 out of the 87 seats in the provincial government. With years of negligence from the New Democratic Party in forming deals for the energy industry Alberta, this should help turn things around and set up a fierce battle with the federal government. Before coming into power, their platform included an 8% corporate tax rate which reduces it from 12%. Also, they have proposed to decrease the carbon tax to spark more growth from the energy industry in hopes to spur job creation. Lastly, they would set up a $30 million “war room” in Canada and internationally to defend Alberta’s energy industry. If any or all of these come to fruition, Suncor stands to benefit.

What has the stock done lately?

On November 14th, the CEO of Suncor decided to retire. Around this same time period, Canada decided to cut production by 325k barrels per day. With these two negative announcements, the stock plummeted to a yearly low of ~ $27/share. Since then, the company announced that they were going to expand production by 10% during 2019 to an average of 820,000 boe/d for FY2019. Soon after this, the differentials between the WCS and WTI tightened sending the stock back up to around $32/share. It has hovered around this price for the past months of March and April.

 Past Year Performance: 

Over the past year, the volatility in Suncor can be attributed to the wild swings in oil prices, production curtailments and earnings announcements. Since the middle of August, Suncor sat at its 52 week high of $42/share – the height of oil prices for 2018. As prices started deteriorating, so did the stock. It fell to a yearly low of $26.5/share, a depreciation of 36.9%.



Source: FactSet

My Takeaway:

Suncor finds itself in a lucrative to benefit from certain favorable domestic and macro factors. The differential in the WCS has been at historic lows at has rebounded since the production cuts levied by the Canadian government continues to ease. With this, Suncor will be able to realize better prices per barrel and are to produce at rates they see fit. Moreover, takeaway capacity continues to get built out in Canada and the U.S. allowing maximum production. From a valuation perspective, their EV/EBITDA multiple of 6.57x is in line with peers despite weak EBITDA performance this past year. Also, Suncor holds one of the largest balance sheets among its peers in Canada. Since E&P’s benefit from scale, Suncor is once again a value play in the portfolio.



Source: FactSet