(PUB) Investing 2016

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5 Morningstar FundInvestor June 2016
Data through May 31, 2016 FINRA members: For internal or institutional use only.
BBH Core Select N Ticker
BBTEX
Yield
0.5%
Total Assets
$4,019 mil
Mstar Category
Large Blend
Benchmark 1: Russell 1000 TR USD
Benchmark 2: S&P 500 TR USD
Morningstar Analyst Rating 05-12-16
„
Morningstar Pillars
Process ∞ Positive
Performance ∞ Positive
People ∞ Positive
Parent ¶ Neutral
Price ¶ Neutral
Morningstar Analyst Rating
Morningstar evaluates mutual funds based on five key pillars, which its
analysts believe lead to funds that are more likely to outperform over the
long term on a risk-adjusted basis.
Analyst Rating Spectrum
Œ „ ´ ‰ Á
Pillar Spectrum
∞ Positive § Negative ¶ Neutral
10.0
15.0
20.0
Historical Profile
Return
Risk
Rating
Above Avg
Low
QQQQ
Above Avg
4 7 7 4 7 7 4 4 Investment Style
Equity
Growth of $10,000
Investment Values of
Fund
Investment Values of
Benchmark 1
( & & ) * & & ) ) ( & Performance Quartile
(within Category)
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 05-16 History
11.94 13.40 10.40 12.59 14.33 14.89 17.35 21.40 22.69 20.40 21.15 NAV
12.77 12.40 -21.65 21.60 14.72 5.70 18.73 26.51 8.41 -2.73 3.68 Total Return %
-2.69 6.63 15.94 -6.84 -1.38 4.20 2.30 -6.60 -4.83 -3.65 0.17 +/- Bmark 1
-3.02 6.91 15.34 -4.87 -0.35 3.59 2.72 -5.88 -5.28 -4.11 0.11 +/- Bmark 2
0.45 0.18 0.17 0.53 0.60 0.52 0.65 0.59 0.67 0.53 0.00 Income Return %
12.32 12.23 -21.83 21.07 14.12 5.19 18.08 25.92 7.74 -3.26 3.68 Capital Return %
74 10 1 84 35 4 9 87 79 72 20 Total Rtn % Rank Cat
0.05 0.02 0.02 0.05 0.08 0.07 0.10 0.10 0.14 0.12 0.00 Income $
0.00 0.00 0.07 0.00 0.04 0.18 0.23 0.43 0.35 1.56 0.00 Capital Gains $
1.24 1.19 1.16 1.21 1.18 1.14 1.12 1.09 1.07 1.07 . Expense Ratio %
0.45 0.18 0.14 0.61 0.55 0.85 0.63 0.65 0.66 0.53 . Income Ratio %
53 18 31 15 19 17 14 12 8 8 . Turnover Rate %
93 126 170 264 507 893 3,483 5,741 5,855 4,125 3,793 Net Assets $mil
Performance 05-31-16
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total
2012 10.88 -0.55 6.82 0.79 18.73
2013 10.66 2.40 4.27 7.07 26.51
2014 1.87 3.49 -0.75 3.62 8.41
2015 -1.19 -0.49 -5.02 4.16 -2.73
2016 2.11 — — — —
Trailing Total
Return%
+/- Bmark
1
+/- Bmark
2
%Rank
Cat
Growth of
$10,000
3 Mo 6.98 -2.45 -2.14 84 10,698
6 Mo 1.25 -0.39 -0.69 41 10,125
1 Yr 0.49 -0.29 -1.22 33 10,049
3 Yr Avg 6.76 -4.13 -4.30 86 12,169
5 Yr Avg 9.58 -1.86 -2.08 62 15,802
10 Yr Avg 8.89 1.39 1.48 3 23,428
15 Yr Avg 5.43 -0.42 3.32 31 22,111
Tax Analysis Tax Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
3 Yr (estimated) 5.55 71 1.13 39
5 Yr (estimated) 8.67 49 0.83 38
10 Yr (estimated) 8.35 2 0.49 19
Potential Capital Gain Exposure: 13% of assets
Rating and Risk
Time
Period
Load-Adj
Return %
Morningstar
Rtn vs Cat
Morningstar
Risk vs Cat
Morningstar
Risk-Adj Rating
1 Yr 0.49
3 Yr 6.76 -Avg Low QQ
5 Yr 9.58 Avg Low QQQ
10 Yr 8.89 High Low QQQQQ
Incept 5.59
Other Measures Standard Index Best Fit Index
Alpha -2.1 -2.0
Beta 0.82 0.82
R-Squared 92 93
Standard Deviation 9.66
Mean 6.76
Sharpe Ratio 0.72
Portfolio Analysis 05-31-16
Total Stocks: 30
Share change since 04-30-16 Sector YTD Ret % % Assets
YBerkshire Hathaway Inc A Finan Svcs 6.19 6.59
YComcast Corp Class A Comm Svcs 8.29 6.38
YOracle Corp Technology 7.37 6.16
YUS Bancorp Finan Svcs 6.82 5.50
YWells Fargo & Co Finan Svcs -7.08 4.93
YAlphabet Inc C Technology — 4.53
YNovartis AG ADR Hlth Care — 4.25
YZoetis Inc Hlth Care -3.73 3.96
YNestle SA ADR Cnsmr Def — 3.73
YMicrosoft Corp Technology -7.95 3.57
YQualcomm Inc Technology 8.12 3.34
Progressive Corp Finan Svcs — 3.11
YDiscovery Communications Cnsmr Cyc 2.01 3.05
YEOG Resources Inc Energy 12.94 3.01
YPayPal Holdings Inc Finan Svcs — 2.94
YDiageo PLC ADR Cnsmr Def — 2.54
Wal-Mart Stores Inc Cnsmr Def 13.10 2.33
TCelanese Corp Basic Mat 4.18 2.28
YLiberty Interactive Corp Cnsmr Cyc -1.60 2.21
YSchlumberger Ltd Energy — 2.19
Current Investment Style
Large Mid Small
Value Blend Growth Market Cap %
Giant 54.5
Large 27.8
Mid 17.7
Small 0.0
Micro 0.0
Avg $mil:
74,678
Value Measures Rel Category
Price/Earnings 18.68 1.08
Price/Book 2.54 1.04
Price/Sales 2.15 1.36
Price/Cash Flow 12.20 1.34
Dividend Yield % 1.84 0.77
Growth Measures % Rel Category
Long-Term Erngs 8.99 0.95
Book Value 4.00 1.27
Sales 3.65 1.66
Cash Flow -3.74 -1.02
Historical Erngs 2.01 0.35
Profitability %
Return on Equity 13.41
Return on Assets 4.62
Net Margin 10.18
Sector
Weightings
% of
Stocks
Rel
Bmark 1
h Cyclical 38.02 1.17
r BasicMat 4.41 1.45
t CnsmrCyc 8.52 0.72
y FinanSvcs 25.09 1.75
u Real Est 0.00 0.00
j Sensitive 37.02 0.92
i CommSrvs 6.94 1.66
o Energy 7.65 1.12
p Industrl 3.27 0.28
a Technlgy 19.16 1.09
k Defensive 24.97 0.92
s CnsmrDef 11.13 1.18
d Hlthcare 13.84 0.95
f Utilities 0.00 0.00
Composition - Net
Cash 8.1
Stocks 91.9
Bonds 0.0
Other 0.0
Foreign 13.2
(% of Stock)
Morningstar's Take by David Kathman, CFA 05-12-16
On Feb. 2, 2016, Brown Brothers Harriman announced
thatBBHCoreSelectwould reopen tonew investorsafter
having been closed since late 2012. This move followed
three-straight years of mediocre performance relative to
the large-blend Morningstar Category and the S&P 500
benchmark, and significant net outflows during 2015. But
investors would do well not to focus too much on the
recent problems, because this remains a fine core stock
fund with a lot of good things going for it. It still earns a
Morningstar Analyst Rating of Silver.
One positive feature of the fund has been its stable
management team. Lead manager Tim Hartch has been
in charge since the fund adopted its current name and
strategy inOctober2005.Sevenof the10othermembers
of the team, including comanager Michael Keller, have
been with him for at least a decade as of May 2016.
(Keller started as an analyst, a role he still fills, but was
also named comanager in 2008.) During that time, they
have consistently employed a disciplined strategy
focused on high-quality, cash-generating stocks that are
trading at least 25% below their estimated intrinsic value.
Theymaintainaconcentratedportfolioofabout30names
that they're willing to hold on to for the long haul, though
they'll sell a stock if it approaches its intrinsic value.
This deliberate, cautious approach has worked
especially well in risk-averse markets such as 2008 and
2011, two years when this was among the best-
performing funds in the large-blend category. Its record
in bull markets is more mixed; sometimes it has
performedverywell,as in2007and2012,butother times
it has lagged its peers and the S&P 500 benchmark. The
latter was the case from 2013 through 2015, when
continuing low interest rates boosted risky, debt-heavy
stocks of the type this fund avoids. But the fund held up
extremely well when the market took a nosedive at the
beginning of 2016, and its returns since the current team
took over rank near the top of the category, with
significantly less volatility than its average peer. There's
still plenty to like here.
Address: BBH Fund Inc Minimum Purchase: $10000 Add: $10000 IRA: —
BOSTON MA 02109 Min Auto Inv Plan: — Add: —
800-575-1265 Sales Fees: No-load, 2.00%R
Web Address: Management Fee: 0.80% mx./0.75% mn.
Inception: 11-02-98 Actual Fees: Mgt:0.80% Dist:—
Advisor: Brown Brothers Harriman & Co. Expense Projections: 3Yr:$322 5Yr:$561 10Yr:$1246
Subadvisor: None Income Distribution: Annually
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