Quick Facts
Investor Institutional
Ticker: BUFBX BUIBX
Daily Pricing:  
As of 6/24/2022  
NAV: $17.92 $17.91
$ Change: $0.42 $0.41
% Change:
2.40% 2.34%
YTD:
-1.74% -1.67%
Inception Date: 8/12/1994 7/1/2019
Expense Ratio: 1.01% 0.86%
Total Net Assets: $490.02 Million  (3/31/22)
Morningstar Category: Allocation – 85%+ Equity
Benchmark Index: Russell 3000
Dividend Distribution: Monthly
Related Material:
   Fund Fact Sheet Q1 2022
   PM Commentary Q1 2022
   Summary Prospectus
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 1,145 Large Value funds as of 5/31/22.

Investment Style

Performance (%)

As of 5/31/223 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
BUFFALO FLEXIBLE INCOME FUND - Investor5.655.1318.2414.2910.498.867.057.957.72
BUFFALO FLEXIBLE INCOME FUND - Institutional5.745.2518.4814.4610.659.037.218.117.88
  Russell 3000 Index-6.15-13.89-3.6815.6012.7514.008.859.2110.22
  Morningstar Moderately Aggressive Target Risk Index-5.55-11.16-7.449.227.729.03---
  Lipper Mixed-Asset Target Allocation Moderate Funds Index-4.82-9.66-5.357.906.417.365.105.926.87
  Morningstar Large Value Category-0.60-3.092.9913.6810.0611.726.777.61-
As of 3/31/223 MOYTD1 YR3 YR5 YR10 YR15 YR20 YRSince Inception
BUFFALO FLEXIBLE INCOME FUND - Investor3.923.9223.8111.9410.208.477.417.567.72
BUFFALO FLEXIBLE INCOME FUND - Institutional4.024.0224.0012.1010.378.647.577.727.88
  Russell 3000 Index-5.61-5.6110.4516.3513.4312.188.007.348.67
  Morningstar Moderately Aggressive Target Risk Index-5.07-5.074.0110.929.738.96---
  Lipper Mixed-Asset Target Allocation Moderate Funds Index-4.89-4.893.679.437.947.425.766.087.12
  Morningstar Allocation 85%+ Equity Category-6.52-6.524.5212.5910.379.946.697.007.68

 2012201320142015201620172018201920202021
BUFFALO FLEXIBLE INCOME FUND - Investor10.3116.683.59-1.979.9013.21-7.0018.76-2.2430.00
BUFFALO FLEXIBLE INCOME FUND - Institutional10.4716.853.75-1.8310.0713.38-6.8618.87-2.1030.21
  Russell 3000 Index16.4233.5512.560.4812.7421.13-5.2431.0220.8925.66
  Morningstar Moderately Aggressive Target Risk Index14.3320.184.97-2.4010.2118.89-6.7422.9513.5114.04
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
6/17/226/21/22$17.63 (Inv)

$17.62 (Inst)
$0.04338733

$0.04578480
-

-
-

-
$0.04338733

$0.04578480
5/17/225/18/22$18.35 (Inv)

$18.34 (Inst)
$0.02507198

$0.02735278
-

-
-

-
$0.02507198

$0.02735278
4/18/224/19/22$19.37 (Inv)

$19.37 (Inst)
$0.00510800

$0.00652534
-

-
-

-
$0.00510800

$0.00652534
3/17/223/18/22$18.58 (Inv)

$18.57 (Inst)
$0.00875767

$0.01084725
-

-
-

-
$0.00875767

$0.01084725
2/17/222/18/22$17.95 (Inv)

$17.94 (Inst)
$0.01556058

$0.01779806
-

-
-

-
$0.01556058

$0.01779806
1/18/221/19/22$18.47 (Inv)

$18.46 (Inst)
$0.01406056

$0.01646594
-

-
-

-
$0.01406056

$0.01646594
2022 Distribution Dates:

Net Investment Income, if any – Record Date (6/17/22); Payment Date (6/20/22)

Net Investment Income, if any – Record Date (7/18/22); Payment Date (7/19/22)

Net Investment Income, if any – Record Date (8/17/22); Payment Date (8/18/22)

Net Investment Income, if any – Record Date (9/19/22); Payment Date (9/20/22)

Net Investment Income, if any – Record Date (10/17/22); Payment Date (10/18/22)

Net Investment Income, if any – Record Date (11/17/22); Payment Date (11/18/22)

Capital Gains, if any – Record Date (12/2/22); Payment Date (12/5/22)

Net Investment Income, if any – Record Date (12/19/22); Payment Date (12/20/22)
For historical distributions, click here.

Portfolio

Portfolio Characteristics
(As of 3/31/22) 
 
# of Holdings55
Median Market Cap$63.33 B
Weighted Average Market Cap$339.53 B
3-Yr Annualized Turnover Ratio3.50%
30-day SEC Yield1.70%
Top 10 Holdings
HoldingTicker / MaturitySector% of Net
Assets
MicrosoftMSFTTechnology9.73%
Costco WholesaleCOSTConsumer Staples3.65%
ChevronCVXEnergy3.65%
QualcommQCOMTechnology3.53%
PfizerPFEHealth Care3.42%
ConocoPhillipsCOPEnergy3.33%
Digital Realty TrustDLRReal Estate3.23%
Eli Lilly & CoLLYHealth Care3.08%
PepsiCoPEPConsumer Staples2.98%
Johnson & JohnsonJNJHealth Care2.75%
TOP 10 HOLDINGS TOTAL39.35%
As of 12/31/21. 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 3/31/22. 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 3/31/22. Allocation percentages may not equal 100% due to rounding.

Management

John Kornitzer
Portfolio Manager

54 Years of Experience

 View full bio

Paul Dlugosch, CFA
Portfolio Manager

25 Years of Experience

 View full bio

Commentary

CAPITAL MARKET OVERVIEW

(As of 3/31/22) — The equity market, as measured by the S&P 500 Index, suffered its second quarterly decline since the onset of the COVID-19 pandemic, over two years ago, producing a return of -4.60% during the January–March period. Weak capital market performance can be largely attributed to the Federal Reserve’s decision to raise interest rates and reduce the size of its balance sheet, also known as quantitative tightening. Other headwinds, including the war in Ukraine, significant inflation, and persistent supply chain bottlenecks, only added to the backdrop of uncertainty for domestic and global markets.

The broad-based Russell 3000 Index fell -5.28% in the quarter. Value stocks outperformed growth stocks by a large amount, as the Russell 3000 Value Index returned -0.85% compared to a decline of -9.25% for the Russell 3000 Growth Index. Large cap stocks fell less than smaller cap stocks during the quarter, as the Russell 1000 Index declined -5.13%, followed by a return of -5.68% for the Russell Midcap Index, and -7.53% for the small cap Russell 2000 Index. Energy stocks surged during the period on rising oil prices while the more defensive Utilities and Telecommunication Services sectors were also modestly positive. The Consumer Discretionary and Technology areas of the market were the largest underperformers due to inflation and rising rates.

PERFORMANCE COMMENTARY

(As of 3/31/22) — The Buffalo Flexible Income Fund (BUFBX) produced a return of 3.92% for the quarter, outperforming the Morningstar Moderately Aggressive Target Risk Index return of -5.07% and the Russell 3000 Index return of -5.61%.

Top Contributors

The top three contributors to the Fund’s performance during the period were Chevron, APA Corporation, and ConocoPhillips. The three companies are involved in the oil and gas industries and benefited from rising commodities prices following increased demand and supply constraints, which was exacerbated by the Russia/Ukraine conflict.

Top Detractors

Partially offsetting the gains above were Microsoft, Digital Realty, and Qualcomm, which were the top three detractors from the Fund’s results. Although all three companies reported good earnings during the quarter, their share prices moved lower as rising interest rates have tempered overall valuations for technology companies.

OUTLOOK

(As of 3/31/22) — Measures of inflation have reached levels not seen in decades, as demand has bounced back, while supply chain issues (bottlenecks, chip shortages, lack of workers, etc.) have restrained supplies. Businesses also lost productivity as COVID-19 continued to lead to employee absenteeism. Additionally, inflation and supply chain issues have been impacted by sanctions against Russia following their invasion of Ukraine. As a result, the Federal Reserve (the “Fed”) has adopted a more hawkish approach toward interest rates and a reduction in their balance sheet. As the Fed implements these programs, it will attempt to strike a delicate balance of curbing inflation without causing a recession. Stock market performance is likely to reflect the view of how well the Fed is managing the situation.

Despite the uncertainty, we remain focused on identifying competitively-advantaged, wide-moat companies trading at reasonable valuations. 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

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 4 stars among 1145 for the 3-year, 4 stars among 1073 for the 5-year, and 1 stars among 778 Large Value funds for the 10-year period ending 5/31/22.

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.

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.