Cortina Asset Management's Founding Partner and Portfolio Manager, Tom Eck, Visited Marquette's AIM Program this Past Week

Tom Eck of Cortina Asset Management Visited Marquette's AIM Program on Friday, October 28, 2016

Tom Eck of Cortina Asset Management
presenting to the AIM Class of 2017

On Friday, October 28^th, Tom Eck was the guest lecturer in the AIM program. The students in the Class of 2017 – similar to all of the other AIM classes over the years – were able to hear Tom’s insights on the investment industry and career planning.

Dr. David Krause, AIM program director said, “It is always a pleasure to host Tom. The AIM students enjoy his interactive style of presentation – he keeps them on their toes intellectually. He is very effective in bringing the world of investing to life.”

Tom Eck, CFA, is a Founding Principal of Cortina Asset Management. He has managed Cortina’s Small Cap Opportunity Strategy since its inception in 2004 - and he has nearly 20 years of experience in the investment industry.

Tom joined the State of Wisconsin Investment Board in 1997, spending two years as a Research Analyst, and from 1999 to 2001 he was an Analyst for a mid and small cap domestic equities team at Strong Capital Management. In 2001, Tom joined U.S. Bancorp Asset Management to co-manage the Health Sciences sector fund then began managing institutional and individual portfolios dedicated to the small cap asset class in 2003.

His background prior to entering the investment management industry was in corporate finance. He holds the Chartered Financial Analyst designation and is a member of the CFA Institute. Tom received his B.B.A. from the University of Notre Dame and M.B.A. in Finance from Marquette University.

Dr. Krause, Tom Eck and Andy Krueger
discuss investment performance after class

Dr. Krause, AIM program director said, "Tom, an alumnus of Marquette, is one of the top speakers we bring to campus during the fall semester. He connects well with the students and is able to offer useful insights into the industry. Tom has served on our faculty as an adjunct investments instructor and has hosted AIM ‘road shows’ at Cortina each of the past seven years. We truly appreciate his passion for learning; he's an outstanding role model for our students."

Mr. Eck talked to the students about his equity investment style, which is to focus on small cap companies that have established defendable competitive advantages and generate strong cash flow over the long run. Tom provided the students with his approach to portfolio management, but he also discussed individual security research. His efforts at Cortina are also directed toward following individual health care, financial and media companies.

Dr. Krause said, “Our thanks go out to Tom and the team at Cortina Asset Management for their hospitality and support of the AIM program over the years. John Potter, Steve Lilly, and the rest of the professionals at Cortina have been marvelous hosts and mentors to our students. It is the support of firms, such as Cortina, that help maintain the ‘applied’ element in the AIM program."

'Fast Facts' about Marquette University's College of Business Administration

Materiel Shared with Companies Seeking More Information about Marquette University's College of Business Administration

This is material used by Marquette University's Business Career Center team with companies recruiting our interns and graduate. It is full of great info to round out your knowledge of the College of Business Administration.

AIM Students Pitched Stocks on October 28, 2016 Following the First Meeting of the AIM Class of 2018

Three AIM students presented their stock recommendations on Friday, October 28, 2016

Over 40 students – including members of the new AIM Class of 2018 attended the eighth set of equity pitches delivered by the Class of 2017 this semester in the AIM Room on Friday, October 28, 2016. 

The three AIM student presentations also were viewed on-line via a webcast by more than 10 alumni and family members across North America – while others joined via Twitter.

Pat Cashner, Dan Drew and Matt Ogren

Dan Drew pitching Eaglet

Friday marked the beginning of the second round of equity presentations for the AIM seniors – and for the remainder of the semester each student will be responsible for at least one more stock pitch.

The AIM student equity pitches take place each Friday afternoon during the semester – either in the AIM Room or at a local investment company. You can also watch the live presentations by the students in the AIM Class of 2017 via webcast.

This week's presentations included:

Student Presenter	Sector	Company Name	Ticker
Pat Cashner	Industrials	Workhorse Group	WKHS
Dan Drew	Healthcare	Eaglet	EGLT
Matt Ogren	Intl Consumer Discretionary	IMAX	IMAX

The students prepare and distribute a professional equity write-up (note: every AIM write-up since the inception of the program in 2005 is archived here).

Pat Cashner

This week’s equity write-ups can be found at:  AIM Equity Write-Up 10/28

The students are responsible for making a seven-minute pitch before their peers, faculty and any alumni or investment professional in attendance. 

Following the student’s pitch the floor is opened up for a question and answer session that lasts about ten minutes. This has been highly instructive as the students must be prepared to defend their investment recommendation and answer questions in an extemporaneous manner.

Matt Ogren

Note: The ballot is prepared and buy and sell recommendations are voted upon by the students over the weekend. The transactions are executed at the beginning of the week.

Dr. Krause, Dr. Wall and 16 students attended the 2016 'Invest For Kids' Conference in Chicago on 11/26/2016

Investment Picks from the Investment Professionals Presenting at the 'Invest For Kids' Conference in  Chicago on November 26, 2016

The 8th annual Invest For Kids Chicago investment conference was held on Wednesday, October 26, 2016, at the Harris Theater. Dr. David Krause, AIM program director, and Dr. Joe Wall, Accounting professor, took 16 students to Chicago for the event.

The students thoroughly enjoyed the event and are thankful that Balyasny Asset Management hosted their admission to the event and the pre-conference university scholars conference at DePaul University. See a previous blog posting for more background on the conference.

The following is from Market Folly and contains their posted notes from the event.  Just click each link to go to that presentation:

- Jim Grant (Grant's Interest Rate Observer): Bearish on BlackRock (BLK)

- Sam Zell (Equity Group): Fireside chat

- John Lykouretzos (Hoplite Capital): Long - Sealed Air (SEE)

- Frank Brosens (Taconic Capital): Long – Kaupthing debt

- Ed Garden (Trian Partners): Long - Bank of New York Mellon (BK) 

- Jonathan Gray (Blackstone Group): On real estate

- Leah Zell (Lizard Investors): Long - BIM, Short - Woolworth's

- Josh Wolfe (Lux Capital): Long - nVidia (NVDA), Short - Intel (INTC)

- Matt Halbower (Pentwater Capital): Long - Turquoise Hill Resources (TRQ), Neutral - VMWare (VMW),  Long - Dell Technologies (DVMT)

- William Heard (Heard Capital): Long - Fair Isaac (FICO)

- Arthur Kaz (Greenbriar Asset Management): Long - Avaya bonds

For more investment conference coverage, be sure to also check out Market Folly’s notes from the recent Sohn San Francisco conference as well as the Great Investors Best Ideas Dallas conference.

The annual ‘Careers in Finance’ will be held at the Marquette University AMU on Friday afternoon, November 4, 2016

Join the Marquette Department of Finance for the alumni presentations and a networking event.

Friday, November 4, 2016

1:30 p.m. - 5:15 p.m.

Marquette University

Alumni Memorial Union (Room 227)

Students will learn:

• About different types of career paths in corporate finance, and commercial banking and lending
• How to handle tough interview questions or what to do when an interview starts to go awry
• How to follow-up after the interview and make the most of networking and social events
• The additional knowledge and polish to help stand out among the competition

Alumni and friends will have the opportunity to:

• Share knowledge with our students
• Get to know and make contacts with our outstanding students
• Re-connect with classmates and network with others in the finance industry

Agenda: (detailed agenda here)

  

1:30 p.m.   Registration - AMU 227

1:50 - 2:00 p.m.   Welcome - AMU 227

2:00 - 2:30 p.m.  Overview of finance career paths - AMU 227

2:35 - 3:15 p.m.  Breakout Session #1

3:20 - 4:00 p.m. Breakout Session #2

4:05 - 5:15 p.m.  Networking reception - Lunda Room / Henke Lounge

Attire: Business casual

"I would strongly encourage students to attend the Careers in Finance day because it provides an in-depth look at what people do with their finance backgrounds. Additionally, it allows one to network with individuals who are more than willing to help motivated students."

Alex Wilke, PNC Financial Services. Analyst

Students can use the link below to RSVP (RSVP is required).

https://marquette.joinhandshake.com/events/17388/share_preview

Additional info about the event can be found at:

http://business.marquette.edu/departments/finance-career-day

Marquette University 2016 Presidential Election Economics and Finance Panel Discussion

Marquette University 

Economics – Finance Pre-Election Panel Presentation and Student Q&A

Date: Thursday, November 3, 2016

Time: 3:30-4:45 pm

Location: DS 105

Join Marquette and Canisus faculty members and alumni for an economic and financial analysis of the upcoming presidential election. What have we learned from the candidates about their positions on economic and financial issues? How unique is this election cycle? What are the implications for equities and fixed income markets? How might the election (and its outcome) affect US and global markets?

Moderator:

• Joseph Daniels, Chair and Professor, Economics, Marquette University

 Panelists:

• Christian Bartley, Managing Director, Faleiro (International Trade and Development), Washington D.C.
• John Davis, Professor, Economics, Marquette University
• David Krause, Director Applied Investment Management & Assistant Professor, Finance, Marquette University
• Kathryn Wagner, Assistant Professor, Economics, Marquette University
• Richard A. Wall, Vice President of Academic Affairs and Professor of Economics and Finance, Canisus College

An AIM Equity Fund Holding: LeMaitre Vascular (LMAT) by Joe Mungenast. “A Soft Buy on LeMaitre for the Time Being”

LeMaitre Vascular, Inc. (LMAT, $19.94): “Has This Vascular Company Stopped Pumping?”

By: Joe Mungenast, 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.

 ·         LeMaitre Vascular Inc. produces medical devices that specialize in the treatment of peripheral vascular disease. LeMaitre produces balloon catheters, carotid shunts, biologic patches, radiopaque marking tape, and vascular grafts, among other components.

·         Based in Burlington, MA, LeMaitre was founded in 1983 by George D. LeMaitre. His son, George D. LeMaitre, is the current CEO and Chairman.

·         LeMaitre just reached its all-time high on the market in September, hitting $22.50. It has since drifted down to $20, where it has floated for nearly a month. An earnings release on October 26 will generate the most movement since LeMaitre’s 52-week high.

·         LMAT remains a strong buy to analysts, while the consensus estimate is $20.25.

LeMaitre Vascular Inc. (LMAT) was originally pitched as a micro-cap to the AIM fund. Since it was added in October 2015, LeMaitre has shown strong core growth as it emerged in the small-cap area, well exceeding the target price of $15.55. The majority of this stock’s increase has from beating estimates, particularly this past quarter.

LMAT is to release its Q3 earnings report on October 26, and Wall Street is anticipating very strong YoY growth of 16.54% for revenue and 39.09% for EPS. This is nothing new to LeMaitre, as they have experienced extremely positive EPS and revenue growth in Q2 from the expansion of its product line. LeMaitre’s products cater to a growing global population of those affected by peripheral artery disease (PAD). According to the CDC, roughly 8 million people in the US suffer from this disease, with a growing emphasis on patients over the age of 60. From 2000 to 2010, researchers in the US and UK found that PAD had grown by nearly 24%. 

Currently, PAD affects every 1 in 10 people over the age of 70, and 1 in 6 over the age of 80. Beyond the US – and in global markets where LeMaitre is pursuing – areas of weaker economies such as Southeast Asia have seen rampant growth in this form of heart disease. While all LeMaitre products have nearly been approved in the UK and US, only a third are allowed to be sold in Asia, pending further approval. While the market for expansion of LMAT’s products appears to be fruitful, the company’s success depends heavily on approval of their products abroad and whether or not it can compete with larger competitors.

What has the stock done lately?

In mid-September, LeMaitre achieved its all-time high of $22.50. This greatly contrasts its 52-week low of $12.03 in February, showing a doubling of the stock price in just over two quarters’ time. The company’s strong operating performance has been the reason for such positive growth over the past few months, and the company currently holds no debt.

Past-Year Performance: LeMaitre has seen quite a bit of movement this year, with most of its growth coming from the past two months. After closing out the 2015 fiscal year around $17.75, the stock had a steady decline into February before reaching its 52-week low of $12.34. After a volatile March, LeMaitre was stagnant until it beat Street estimates for its 2Q performance, jumping from $14.63 to $17.89 in late July before peaking to $22.50 in September.

 Source: FactSet

My Takeaway

 LeMaitre is sitting on excellent growth opportunities in the future, but its PEG ratio of 2.68 is one of the primary concerns for at least the next few years. It is my belief that analysts will start to drift more towards soft buy recommendations as this company’s dollar-to-earnings growth becomes less and less undervalued to the market, especially considering recent earnings beats. From a macro perspective, this company will be considered a strong buy once its products are approved overseas and LMAT can better utilize its pricing power (70% gross margin) against difficult peer competition in this healthcare space.

This week the AIM students learned about SRI and Catholic responsible investing from representatives of Christian Brothers Investment Services

 Christian Brothers Investment Services  (CBIS) 

Promotes Socially Responsible Investing

On Monday, October 24^th, Dr. Krause and the students in the AIM program heard an excellent presentation about socially responsible investing (SRI). Representing Christian Brothers Investment Services were Julie Tanner, Director of Catholic Responsible Investing; Tim Schwarzenberger, Head of Portfolio Services; and Tom Kelly (AIM alumnus), Portfolio Specialist, Distribution Services Team

Christian Brothers Investment Services (CBIS) is a Catholic socially responsible asset management firm. Founded in 1981 by the De La Salle Christian Brothers, CBIS works exclusively with Catholic institutions and their fiduciaries. They offers services to numerous dioceses, colleges and universities, religious institutes and health care systems. They currently manage over $6 billion in assets globally and have offices in the U.S. and Europe (New York, Chicago, San Francisco and Rome).

Julie Tanner, Tim Schwarzenberger,

Tom Kelly, and Dr. David Krause

Christian Brothers uses Catholic beliefs as the basis of their ongoing corporate dialogues, encouraging companies to create long-term strategies and policies that potentially reduce investment risk and increase shareholder value.

Dr. Krause said, “Christian Brothers is a manager of managers. In other words, they engage third parties to actively sub-advise the assets in their portfolios. They offer two product lines: US-domiciled, commingled funds and Ireland-domiciled global funds for Catholic institutions in select countries around the world.

The AIM students learned that CBIS’ primary investment philosophy is to deliver highly competitive risk adjusted investment returns in a manner consistent with the moral and social teachings of the Catholic Church. They believe that they successfully utilize investors who can generate favorable long-term risk-adjusted performance and support the conviction of Catholic responsible investing. Their process is to utilize Catholic investing screens to avoid companies providing products or services that violate Catholic teachings.

Julie Tanner, Director,
Catholic Responsible Investing

Examples of key issues that could exclude firms from their portfolios include those that produce or engage in providing the following: abortifacients, contraceptives, embryonic stem cell research, human cloning, fetal tissue research, pornography, major weapons manufacturers, producers of landmines, manufacturers of firearms, tobacco products, etc.

Their process involves reviewing company researchand creating a list of prohibited companies to their sub-advisers. They employ a diverse range of strategies to implement their Catholic responsible investing program which includes screening and activism.

By active ownership of the shares of firms that do not meet their standards they engage in some or all of the following activities: corporate engagements, shareholder resolutions and proxy voting.

Tom Kelly

Dr. Krause commented, “It was great to see Tom Kelly and I am pleased that he was able to bring his colleagues to campus. The AIM students engaged in a discussion with our guests from CBIS about socially responsible investing (which is an investment strategy which seeks to consider both financial return and social good).  They were very interested in learning more about ESG investing – which is the incorporation of environmental, social and governance factors into traditional financial analysis. It was an excellent presentation and the AIM students are likely to not only select companies with strong financial performance prospects, but also those that are ESG leaders in their respective industries.”

After the class, Mr. Bill Walker (AIM Adjunct Lecturer) and I met with Julie, Tim and Tom to discuss ways that the AIM program can work SRI practices into the investment curriculum. Krause summarized, “This was an excellent presentation and I know that the students are committed to making sound investment decisions that consider both financial return and social good – it is consistent with our mission and values at Marquette University.”