Quick Facts
Investor Institutional
Ticker: BUFBX BUIBX
Daily Pricing:  
As of 2/23/2024  
NAV: $19.99 $19.98
$ Change: $-0.01 $-0.01
% Change:
-0.05% -0.05%
YTD:
5.40% 5.43%
Inception Date: 8/12/1994 7/1/2019
Expense Ratio: 1.01% 0.86%
Total Net Assets: $448.13 Million  (9/30/23)
Morningstar Category: Large Value
Benchmark Index: Russell 3000
Dividend Distribution: Monthly
Related Material:
   Fund Fact Sheet Q4 2023
   PM Commentary Q4 2023
Fund Objective & Investment Process

The investment objective of the Buffalo Flexible Income Fund is primarily the generation of high current income and, as a secondary objective, the long-term growth of capital. To pursue its investment objectives, the Flexible Income Fund invests in both debt and equity securities.

The allocation of assets invested in each type of security is designed to balance income and long-term capital appreciation with reduced volatility of returns. The Flexible Income Fund expects to change its allocation mix over time based on the Fund managers’ view of economic conditions and underlying security values.

The Fund maintains a flexible investment policy which allows it to invest in debt securities with varying maturities. However, it is anticipated that the dollar-weighted average maturity of debt securities that the Fund purchases will not exceed 15 years.

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Our investment strategy seeks to generate yield for any investor needing monthly income with capital appreciation, and we use many methods to address potential downside risks.

John Kornitzer, Portfolio Manager

Morningstar Rating

        

Overall Morningstar Rating™ of BUFBX based on risk-adjusted returns among 1,129 Large Value funds as of 1/31/24.

Investment Style

Performance (%)

As of 1/31/243 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
BUFFALO FLEXIBLE INCOME FUND - Investor8.722.387.5513.2710.037.5010.127.777.57
BUFFALO FLEXIBLE INCOME FUND - Institutional8.762.407.7113.4410.187.6510.287.937.73
  Russell 3000 Index16.401.1119.159.1013.5311.9614.599.6110.28
  Lipper Mixed-Asset Target Allocation Moderate Funds Index11.560.308.343.466.846.028.285.766.77
As of 12/31/233 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
BUFFALO FLEXIBLE INCOME FUND - Investor5.267.437.4313.2511.027.089.857.747.51
BUFFALO FLEXIBLE INCOME FUND - Institutional5.307.537.5313.4311.177.2310.017.907.67
  Russell 3000 Index12.0725.9625.968.5415.1611.4813.849.6710.27
  Lipper Mixed-Asset Target Allocation Moderate Funds Index8.8513.3413.343.217.865.847.965.816.78

2013201420152016201720182019202020212022
BUFFALO FLEXIBLE INCOME FUND - Investor16.683.59-1.979.9013.21-7.0018.76-2.2430.004.01
BUFFALO FLEXIBLE INCOME FUND - Institutional16.853.75-1.8310.0713.38-6.8618.87-2.1030.214.22
  Russell 3000 Index33.5512.560.4812.7421.13-5.2431.0220.8925.66-19.21
  Morningstar Moderately Aggressive Target Risk Index20.184.97-2.4010.2118.89-6.7422.9513.5114.04-15.48
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.
Hypothetical Growth of $10,000
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on the Fund’s inception date. Assumes reinvestment of dividends and capital gains. This chart does not imply future performance.
Distributions
Record
Date
Payable
Date
Distribution
NAV
Net Investment
Income
Short-Term Capital
Gains
Long-Term Capital
Gains
Distribution
Total
12/18/2312/19/23$19.01 (Inv)

$19.00 (Inst)
0.08034668

0.08274205
-

-
-

-
$0.08034668

$0.08274205
12/04/2312/05/23$18.71 (Inv)

$18.71 (Inst)
-

-
0.013256

0.013256
0.29396

0.29396
$0.307216

$0.307216
11/17/2311/20/23$18.95 (Inv)

$18.95 (Inst)
$0.04860440

$0.05098797
-

-
-

-
$0.04860440

$0.05098797
10/17/2310/18/23$18.80 (Inv)

$18.79 (Inst)
$0.00890528

$0.01113460
-

-
-

-
$0.00890528

$0.01113460
9/18/239/19/23$19.01 (Inv)

$19.00 (Inst)
$0.03219621

$0.03468704
-

-
-

-
$0.03219621

$0.03468704
8/17/238/18/23$18.77 (Inv)

$18.76 (Inst)
$0.04713517

$0.04950089
-

-
-

-
$0.04713517

$0.04950089
7/17/237/18/23$18.49 (Inv)

$18.48 (Inst)
$0.010651

$0.01269631
-

-
-

-
$0.010651

$0.01269631
6/20/236/21/23$18.28 (Inv)

$18.27 (Inst)
$0.04583939

$0.04845177
-

-
-

-
$0.04583939

$0.04845177
5/17/235/18/23$18.09 (Inv)

$18.08 (Inst)
$0.03596397

$0.03824220
-

-
-

-
$0.03596397

$0.03824220
4/17/234/18/23$18.56 (Inv)

$18.55 (Inst)
$0.00898005

$0.01027078
-

-
-

-
$0.00898005

$0.01027078
3/17/233/20/23$17.39 (Inv)

$17.38 (Inst)
$0.00189166

$0.00397169
-

-
-

-
$0.00189166

$0.00397169
2/17/232/21/23$18.07 (Inv)

$18.07 (Inst)
$0.01819947

$0.02067154
-

-
-

-
$0.01819947

$0.02067154
1/17/231/18/23$18.38 (Inv)

$18.38 (Inst)
$0.01465833

$0.01685378
-

-
-

-
$0.01465833

$0.01685378
For historical distributions, click here.

Portfolio

Portfolio Characteristics
(As of 12/31/23) 
 
# of Holdings46
Median Market Cap$78.87 B
Weighted Average Market Cap$412.94 B
3-Yr Annualized Turnover Ratio2.40%
30-day SEC Yield1.86%
Top 10 Holdings
HoldingTicker / MaturitySector% of Net
Assets
Microsoft CorporationMSFTInformation Technology8.03
Hess CorporationHESEnergy4.90
Eli Lilly and CompanyLLYHealth Care4.75
Chevron CorporationCVXEnergy4.66
ConocoPhillipsCOPEnergy4.37
Exxon Mobil CorporationXOMEnergy4.29
Costco Wholesale CorporationCOSTConsumer Staples3.75
APA CorporationAPAEnergy3.63
Arthur J. Gallagher & Co.AJGFinancials3.53
PepsiCo, Inc.PEPConsumer Staples3.00
TOP 10 HOLDINGS TOTAL44.91%
As of 9/30/23. 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 12/31/23. 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.

Asset Allocation

As of 12/31/23. Allocation percentages may not equal 100% due to rounding.

Management

John Kornitzer
Portfolio Manager

55 Years of Experience

 View full bio

Paul Dlugosch, CFA
Portfolio Manager

26 Years of Experience

 View full bio

Commentary

PERFORMANCE COMMENTARY

(As of 12/31/23)

The Buffalo Flexible Income Fund produced a return of 5.26% compared to
the primary prospectus benchmark, Russell 3000 Index, return of 12.07%. The
energy sector was primarily responsible for the underperformance relative to the
benchmark. The fund was overweight the worst performing sector of the market
during the quarter. Specific energy companies in the portfolio that contributed to the
underperformance included Exxon, Chevron, APA, Hess and Schlumberger. Share
prices for all of these were down between 5%-14% during the quarter. The primary
driver behind the decline in the energy valuations was the decline in oil prices, which
fell from roughly $85 at the end of September to roughly $71 at year-end. Accordingly,
the stock price of energy companies fell, as their near-term profits are likely to
contract despite no adverse material stock specific information related to any of these
companies during the quarter.

Top Contributors
The top three contributors to the fund during the quarter were Microsoft, Qualcomm
and Allstate. Microsoft reported strong earnings results driven by continued growth in
Office and Azure. Additionally, the company’s guidance was better than expected and
was driven by continued positive business momentum. Qualcomm reported better
than expected earnings and provided better than expected guidance. Additionally, the
company indicated that handset channel inventory levels were back to more normalized
levels. Meanwhile, Allstate benefitted from a strong pricing environment as well as lower
loss ratios.

OUTLOOK

(As of 12/31/23)

The economy is slowing to a more sustainable level of growth as consumers have
spent much of the excess savings accumulated during the pandemic. With demand
moderating and the job market beginning to loosen, we believe inflationary pressures
will continue to moderate. The Fed’s aggressive tightening cycle appears to be getting
the job done on inflation, and a disaster scenario of stubbornly high inflation coupled
with a consumer-led recession appears to be off the table. Moreover, the Fed now has
firepower to stimulate when needed.

Following the sharp rally to close out 2023, the market seems likely to consolidate its
gains in the near term. Numerous forward-looking indicators suggest the economy will
soften in 2024, including an inverted Treasury yield curve, a decline in the Conference
Board Leading Economic Index, and the National Federation of Independent
Businesses’ (NFIB) hiring plans survey. And while the Fed can cut short-term interest
rates to stimulate demand, we do not expect another round of stimulus checks given
the Federal government is already running an unsustainable $2 trillion annual deficit.
Against this backdrop, expect management teams to offer cautious forward-looking
guidance.

We remain focused on wide moat, large capitalization dividend-paying companies
trading at reasonable valuations, in our view. As always, the fund will continue to
emphasize competitively advantaged companies that can be purchased at a fair value.
We will be ready to take advantage of opportunities created by stock market volatility
using market declines as attractive entry points for long-term investors.

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.

Literature

Buffalo Flexible Income Fund
Documents
Last
Updated
  Fact Sheet12/31/23
  Quarterly Commentary12/31/23
  Full Fund Holdings6/30/23
  Prospectus7/28/23
  Statement of Additional Information7/28/23
  Annual Report3/31/23
  Semi-Annual Report9/30/22
  Tax Guide - 20231/8/24
General Account
Forms
Investor
Class
Institutional
Class
Both
  New Account Application
  New Account Application - Entity
  Change or Add Account Details
  Cost Basis Method Election
  Power of Attorney
Individual Retirement Account (IRA) Forms
  IRA Account Application
  IRA Beneficiary Addition / Change
  IRA Required Minimum Distribution (RMD)
  IRA / Qualified Plan Distribution Request
  IRA Transfer
Coverdell Education Savings Accounts (ESA) Forms
  Coverdell ESA Application
  Coverdell ESA Distribution Request
  Coverdell ESA Transfer
Retirement Information
  Retirement Savings Options for Individuals

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 Flexible Income Fund (BUFBX) received 5 stars among 1129 for the 3-year, 4 stars among 1074 for the 5-year, and 2 stars among 825 Large Value funds for the 10-year period ending 1/31/24.

Bond ratings are grades given to bonds that indicates their credit quality as determined by a private independent rating service such as [Standard & Poor’s or Moody’s, etc.]. The firm evaluates a bond issuer’s financial strength, or its ability to pay a bond’s principal and interest in a timely fashion. Ratings are expressed as letters ranging from ‘AAA’, which is the highest grade, to ‘D’, which is the lowest grade. Not Rated category includes holdings that are not rated by any rating agencies.