Quick Facts
Inception Date:5/21/20047/1/2019
Expense Ratio:1.51%1.37%
Total Net Assets:$131.77 Million  (3/31/21)
Category:Small Cap Growth
Benchmark:Morningstar U.S. Small Growth
Related Material:
   Fund Fact Sheet Q1 2021
   PM Commentary Q1 2021
   Summary Prospectus
Recent Media Coverage
Fund Objective & Investment Process

As of October 16, 2020, the name of the Buffalo Emerging Opportunities Fund changed to the Early Stage Growth Fund.

The investment objective of the Buffalo Early Stage Growth Fund is long-term growth of capital. The Fund invests primarily in equity securities, consisting of a portfolio of between 50-70 domestic common stocks, preferred stocks, convertible securities, warrants and rights, of companies that, at the time of purchase by the Fund, have market capitalizations below the median of the Fund’s benchmark index of $3.4 billion or less (as of September 30, 2020) and are companies that are starting to develop a new product or service or have recently developed a new product or service.

The Fund managers seek to identify companies for the Fund’s portfolio that are expected to experience growth based on the identification of long-term, measurable secular trends, and which, as a result, may have potential revenue growth in excess of the gross domestic product growth rate. Companies are screened using in-depth, in-house research to identify premier early-stage growth companies which generally demonstrate:

  • Strong management teams
  • Little or no debt
  • Potential for increasing free cash flow
  • Scalable business models with a competitive advantage
  • Potential for increasing margins
  • Attractive risk/reward given the market framework

We believe investing in an actively-managed portfolio of premier, early-stage, growth companies could lead to growth of capital over time. We look for companies that could benefit from long-term industrial, technological, or general market trends, and are trading at what we view as attractive valuations.

Craig Richard, Portfolio Manager

Morningstar Rating


Overall Morningstar Rating™ of BUFOX based on risk-adjusted returns among 574 Small Growth funds as of 4/30/21.

Investment Style

Performance (%)

As of 4/30/213 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
BUFFALO EARLY STAGE GROWTH FUND - Investor7.9811.6385.8626.9624.8716.8610.9311.64
BUFFALO EARLY STAGE GROWTH FUND - Institutional8.0011.6986.1527.1525.0617.0411.1011.80
  Morningstar U.S. Small Growth Index-1.672.7663.2519.9019.7913.3510.4611.25
  Morningstar Small Growth Category7.3411.0675.6721.8420.9613.3610.6010.71
As of 3/31/213 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
BUFFALO EARLY STAGE GROWTH FUND - Investor7.627.62112.8625.8624.4716.8410.7011.45
BUFFALO EARLY STAGE GROWTH FUND - Institutional7.647.64113.2526.0524.6617.0110.8711.62
  Morningstar U.S. Small Growth Index-0.42-0.4281.9218.4819.4313.3610.2511.10
  Morningstar Small Growth Category6.936.9395.9720.4920.4613.4310.3310.52

*As of October 16, 2020, the name of the Buffalo Emerging Opportunities Fund changed to the Early Stage Growth Fund.

For performance prior to 7/1/19 (Inception Date of Institutional Class), performance of the Investor Class shares is used and includes expenses not applicable and lower than those of Investor Class shares.Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and 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. Current performance of the fund may be lower of higher than the performance quoted and can be obtained here. Performance is annualized for periods greater than 1 year. Each Morningstar category average represents a universe of funds with similar objectives.

3 Year Risk Metrics
BUFOX vs Morningstar U.S. Small Growth Index (As of 3/31/21)
Upside Capture115.27
Downside Capture92.31
Sharpe Ratio0.97
Hypothetical Growth of $10,000
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on the Inception Date. Assumes reinvestment of dividends and capital gains. This chart does not imply future performance.


Portfolio Characteristics
(As of 3/31/21) 
# of Holdings62
Median Market Cap$1.71 B
Weighted Average Market Cap$2.30 B
3-Yr Annualized Turnover Ratio36.80%
% of Holdings with Free Cash Flow64.06%
Active Share93.28%
Top 10 Holdings
HoldingTickerSector% of Net
Open Lending Corp.LPROFinancial Services2.82%
OmnicellOMCLHealth Care2.35%
Advanced Drainage SystemsWMSIndustrials2.28%
Varonis SystemsVRNSTechnology2.23%
dMY Technology GroupDMYDFinancial Services2.20%
Willdan GroupWLDNReal Estate2.04%
As of 12/31/20. Top 10 Holdings for the quarter are not disclosed until 60 days after quarter end. Fund holdings are subject to change and are not recommendations to buy or sell any securities.
Sector Weighting
As of 3/31/21. Security weightings are subject to change and are not recommendations to buy or sell any securities. Sector Allocation may not equal 100% due to rounding.
Market Capitalization
As of 3/31/21. Market Cap percentages may not equal 100% due to rounding.


Craig Richard, CFA
Portfolio Manager

19 Years of Experience

 View full bio

Doug Cartwright, CFA
Portfolio Manager

15 Years of Experience

 View full bio



(As of 3/31/21) — Equity markets continued to move higher in the 1st quarter of 2021, with the S&P 500 Index returning 6.17%. The period was marked by outperformance of value stocks as the market rotation that began in the last quarter of 2020 became even more pronounced. The vaccination rollout, combined with prospects for more fiscal stimulus, bolstered optimism towards companies that could benefit from the economy reopening. Additionally, an 80+ basis point move higher in the 10-Year U.S. Treasury yield during the quarter left sentiment towards growth stocks relatively more subdued.

The broad market Russell 3000 Index advanced 6.35% in the quarter. Value outperformed growth for the second straight quarter, with the Russell 3000 Value Index up 11.89% compared to the Russell 3000 Growth Index returning 1.19%. Relative performance was inversely-correlated with market cap size in the quarter, with the Russell Micro Cap Index up 23.89%, the small cap Russell 2000 Index up 12.70%, the Russell Midcap Index up 8.14%, and the large cap Russell 1000 Index returning 5.91%. The more cyclically-sensitive Energy, Financial, and Industrial sectors performed best in the quarter. Consumer Staples, Information Technology, and Utilities were the bottom three performing sectors. All sectors produced positive returns.


(As of 3/31/21) — During the quarter the Buffalo Early Stage Growth Fund (BUFOX) generated a return of 7.62%. This result exceeded the Fund’s primary benchmark (Morningstar U.S. Small Growth Index) return of -0.42%. The Russell 2000 Growth Index returned 4.88%.

On a trailing 12 month basis, the Fund returned 112.86%. This compared favorably to the primary benchmark return of 81.92% and the Russell 2000 Growth Index return of 90.20%.

The March 2021 quarter continued to drive positive market returns following a historic December quarter. The U.S. has moved closer towards COVID-19 herd immunity, as more than 50% of the adult population has had at least one vaccine dose. As a result, the potential runway for economic growth is becoming clearer for 2021 and beyond. Additionally, another fiscal stimulus bill to the tune of $1.9 billion was signed in March and provides further support for the economic outlook in the U.S.

The Fund’s outperformance in the quarter was driven by solid returns versus the benchmark in the Consumer Discretionary and Health Care sectors, with Fund returns of 14.7% and 20.5%, respectively, in those sectors.

Individual standouts in the quarter included Mohawk Group Holdings and Sleep Number. Mohawk is a new consumer economy play, creating brands for online purchasing only, primarily on Amazon. Mohawk uses artificial intelligence and data analytics to discover consumer categories online where there is an opportunity for a new entrant to take market share. Focusing on user product reviews, customer service, product quality, and real-time pricing, Mohawk has created category sales leaders on Amazon in kitchen appliances, environmental appliances, beauty products, and consumer electronics. Additionally, Mohawk has begun to use its platform to scale the business by acquiring other Amazon sellers at very attractive valuations and layering them on to Mohawk’s highly automated technology platform. Mohawk is in the early innings of this consolidation play and has ample opportunity remaining.

Sleep Number is a mattress company known for layering technology and analytics into their product offering. Demand remains strong for their Sleep 360 smart beds launched several years ago. Sleep Number beds track heart rate, breathing, sleep/wake cycles, and overall sleep health, all reported through a free app for devices such as smartphones. The pandemic has served to refocus many people on their overall health, and sleep health has become a focal point for many. The demand environment has remained strong and we believe the company will likely continue leading the pack in technology innovation in the mattress industry.

The Fund ended the quarter with 64 holdings. We added 6 new holdings and sold out of 7 during the period. Of note, 4 of the 7 holdings sold out of the Fund departed due to being acquired by a larger competitor or private equity.


(As of 3/31/21) — The successful vaccine rollouts in the U.S. along with continued monetary and fiscal stimulus has created a strong outlook for the domestic economy for the remainder of 2021. COVID-19 hospitalizations are down to 35,000 currently, from a high of 125,000 in early January, and almost 70% of the most susceptible population (those over 65) have been fully vaccinated. Additionally, additional stimulus of $1.9 billion was passed in early March that provided more direct payments to households in the U.S. Coupled with Federal Reserve statements of continuing monetary policy support, the economic landscape remains favorable. Personal incomes, checking/savings account balances, and money market fund balances are at record levels. This continues to provide strong support for equity prices in the near future.

With the strong recovery in equity markets given the economic backdrop mentioned above, we are vigilant of where valuation multiples stand across our holdings. Additionally, we are concerned about the possibility for accelerating price inflation.

Regardless of all the backdrop we are presented with, our job remains to find attractive small cap companies that have not been fully appreciated by the market or are mispriced due to recent results or events. We believe less investor interest in our segment of the market creates opportunity for us to uncover value.

The Fund typically invests at the smaller end of the small cap growth spectrum, and the managers continue to seek companies with sustainable growth, due to secular growth trends or innovative or disruptive products.

The Buffalo Early Stage Growth Fund is focused primarily on identifying innovation within U.S. companies with primarily North American revenue bases. With an active share of greater than 95%, the Fund will continue to offer a distinct offering from the benchmark Index and category peers.

The opinions expressed are those of the Portfolio Manager(s) and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security. Earnings growth is not representative of the fund’s future performance.


General Account
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Retirement Information
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Fundamental Approach

We get to know the companies we invest in and learn how they run their business.

Top-Down & Bottom-Up

We identify Top-Down broad, secular growth trends and search for companies from the Bottom-Up.

Proprietary Philosophy

We construct our portfolios based on our own proprietary investment strategy.

Disciplined Investing

Sticking to our disciplined investment strategy ensures we maintain a consistent, balanced approach.

The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating™ for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating™ metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The Buffalo Early Stage Growth Fund (BUFOX) received 4 stars among 574 for the three-year, 4 stars among 502 for the five-year, and 5 stars among 380 Small Growth funds for the ten-year period ending 4/30/21.

In each Morningstar Category, the 10% of funds with the lowest measured risk are described as Low Risk, the next 22.5% Below Average, the middle 35% Average, the next 22.5% Above Average, and the top 10% High. Morningstar Risk is measured for up to three time periods (three, five, and 10 years). These separate measures are then weighted and averaged to produce an overall measure for the fund. Funds with less than three years of performance history are not rated. ©2021 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. The Morningstar Style Box™ reveals a fund’s investment strategy by showing its investment style and market capitalization based on the fund’s portfolio holdings.