Quick Facts

(As of 3/31/17)


Inception Date
  December 17th, 2001

Total Fund Assets
  $395.4 M

Expense Ratio

Benchmark Index
  Russell Midcap Growth


Overall Morningstar™ rating out of 576 Mid-cap Growth funds as of 4-30-2017 (derived from a weighted average of the fund’s three-, five-, and ten-year risk adjusted return measure, if applicable).


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.




Investment Strategy

The investment objective of the Buffalo Mid Cap Fund is long-term growth of capital. The Mid Cap Fund normally invests at least 80% of its net assets in equity securities, consisting of domestic common stocks and preferred stocks of medium capitalization (“mid-cap”) companies — companies, at the time of purchase, with market caps within the range of the Russell Midcap® Growth Index ($1.1 billion to $28.6 billion, as of 6/30/16).


Our focus has always been on investing in secular growth companies we believe are attractively-priced with strong balance sheets. We remain convinced the inefficiencies inherent in the small and mid-cap market spectrum, in addition to where we are in the economic cycle, are best suited for disciplined, active management of the portfolio.

~ Robert Male, Portfolio Manager

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(As of 4/30/17)3 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
Buffalo Mid Cap Fund4.636.9416.476.379.336.528.297.88
Russell Midcap Growth Index4.988.4815.838.9512.287.839.078.43
Lipper Mid Cap Growth Index6.9910.5318.208.4411.207.478.087.57
Morningstar Mid-Cap Growth5.589.2516.967.8010.806.927.95-
Each Morningstar category average represents a universe of funds with similar objectives.
(As of 3/31/17)3 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
Buffalo Mid Cap Fund4.604.6012.944.378.356.787.847.77
Russell Midcap Growth Index6.896.8914.077.8811.958.138.578.37
Lipper Mid Cap Growth Index8.018.0116.556.5610.557.657.677.45
Morningstar Mid-Cap Growth7.307.3015.586.0610.307.127.58-
Each Morningstar category average represents a universe of funds with similar objectives.
YearBuffalo Mid Cap FundRussell Midcap Growth IndexMorningstar Mid-Cap Growth Category
Each Morningstar category average represents a universe of funds with similar objectives.
(As of 3/31/17)
vs Russell Midcap Growth Index
Upside Capture90.58
Downside Capture112.03
Standard Deviation12.38
Sharpe Ratio0.34

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.

Growth of $10k

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.


(As of 3/31/17)
# of Holdings82
Median Market Cap$9.02 B
Weighted Average Market Cap$12.73 B
3-Yr Annualized Turnover Ratio33.19%
% of Holdings with Free Cash Flow81.93%
% of Holdings with No Net Debt32.53%
Active Share80.56%
HoldingTickerSector% of Portfolio
Harman Industrial Industries HARTechnology2.73%
WhiteWave Foods WWAVConsumer Staples2.45%
Kansas City Southern KSUIndustrials2.32%
Equinix EQIXReal Estate2.26%
CME Group CMEFinancial Services2.24%
Verisk Analytics VRSKIndustrials2.19%
Tractor Supply TSCOConsumer Discretionary2.08%
Air Products & Chemicals XNYSMaterials2.05%
Nielsen Holdings NLSNIndustrials2.01%
FMC FMCMaterials1.92%
View Full Holdings

As of 12/31/16. Top 10 Holdings for the quarter are not disclosed until 60 days after quarter end. Those listed are for the previous quarter. Fund holdings are subject to change and are not recommendations to buy or sell any securities.

Buffalo publishes this listing of securities held as of the most recent calendar-quarter end, with a 30 or 60 day lag depending on the portfolio. Buffalo may exclude any portion of holdings from publication when deemed in the best interest of the portfolio.

The portfolio data and its presentation here may differ from the complete schedules of investments in regulatory filings due to differing accounting and reporting requirements.

As of 3/31/17. 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.

As of 3/31/17. Market Cap percentages may not equal 100% due to rounding.


Equity markets got off to a strong start in the first quarter of 2017, thanks to an improving economic outlook. In February, small business optimism, as measured by the National Federation of Independent Businesses, was at its highest level in 12 years. In addition, the University of Michigan’s March consumer confidence survey showed that consumers were more confident in the economy than they have been at any time since 2000. Against this backdrop, growth stocks outperformed value stocks, led by technology, health care, and consumer discretionary companies. The recent strength in infrastructure companies, banks, and high-tax-rate stocks stalled late in the quarter when, following Congress’s failure to agree on a health care reform bill, investors began to question the Trump administration’s ability to enact elements of its pro-growth agenda. Within commodities, the price of West Texas Intermediate (WTI) crude oil fell 6% during the quarter in response to better than expected U.S. oil inventories and production.

The Russell 3000 Index advanced 5.74% in the first quarter and larger cap stocks outperformed smaller cap stocks. The Russell 1000 Index returned 6.03%, followed by the Russell Mid Cap Index return of 5.15%, and the Russell 2000 Index result of 2.47%. The Russell Micro Cap Index advanced just 0.38% in the quarter. The Russell 3000 Growth Index outperformed the Russell 3000 Value Index by 5.64%. Technology was the best performing sector during the quarter while the energy sector was the worst performer, driven by the decline in crude oil.


The Buffalo Mid Cap Fund generated a return of 4.60% for the quarter which underperformed the Russell Midcap Growth Index return of 6.89%. The Index was primarily driven higher by contributions from the health care, information technology, and consumer discretionary sectors. The Fund’s relative underperformance was a result of difficult stock selection in the consumer discretionary, staples and health care areas. Positive stock selection in financials and the real estate sectors helped partially offset soft relative performance in the areas mentioned above. Also negatively impacting performance was our attention to valuation as we trimmed stocks throughout the quarter that continued to move higher. We are actively deploying capital into areas we believe have a more favorable risk/reward profile.

The fund’s consumer discretionary sector experienced negative selection effect in the quarter with both Tractor Supply Company and Advanced Auto Parts contributing to the underperformance. Both companies were impacted by unfavorable weather. Advanced Auto was also impacted by rumors of Amazon more aggressively entering the automotive aftermarket parts space. Despite the weakness from both stocks this period we remain positive on the long term fundamentals of both companies and believe the valuation profiles are compelling.

The fund’s financials performed well in the quarter. MSCI was the sectors top contributor with a total return of approximately 24%. The company, which provides benchmark indexes and portfolio risk analytics tools to institutional investors, benefited from the growth in ETFs and risk management solutions. MSCI operates an attractive business model that has a substantial recurring revenue stream with meaningful barriers to entry.


The setup for 2017 appears to bode well for both accelerated economic growth and performance of U.S equities. The new administration’s focus on deregulation, infrastructure spend, and tax reform point to a more pro-growth, business-friendly environment. Investors are now keeping a close eye on President Trump’s ability to pass meaningful tax reform, especially after promises of healthcare reform have so far fallen short. Inability to provide tax reform may cause market volatility though expectations for the timing of results are being actively managed by the new administration.

While we are pleased with the number of positions in the portfolio, we continue to look for additional ideas that could provide greater risk adjusted return potential. We have spent considerable time over the past few months analyzing companies with a greater cyclical profile that could stand to benefit from factors like accelerating job growth, improved construction activity, and increased energy production. We would expect those kinds of companies to outperform in this environment of an elongated economic cycle. While we have added some new positions in these areas, we are remaining true to our process of identifying what we believe to be beneficiaries of long-term trends and implementing our valuation discipline. We continue to actively reduce stocks with potential disproportionate downside risk and appreciate your continued support and confidence.

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. Fund holdings and sector allocations are subject to change and are not recommendations to buy or sell any security.

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.

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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 Mid Cap Fund received 2 stars among 576 for the three-year, 2 stars among 501 for the five-year, and 3 stars among 371 Mid-Cap Growth category funds for the ten-year period ended 4/30/17.

The Morningstar Sustainability Rating™ is intended to measure how well the issuing companies of the securities within a fund’s portfolio holdings are managing their environmental, social, and governance, or ESG, risks and opportunities relative to the fund’s Morningstar Category peers. The Morningstar Sustainability Rating calculation is a two-step process. First, each fund with at least 50% of assets covered by a company-level ESG score from Sustainalytics receives a Morningstar Portfolio Sustainability Score. The Morningstar Portfolio Sustainability Score is an asset-weighted average of normalized company-level ESG scores with deductions made for controversial incidents by the issuing companies, such as environmental accidents, fraud, or discriminatory behavior. The Portfolio Sustainability Score ranges between 0 to 100, with a higher score indicating that a fund has, on average, more of its assets invested in companies that score well after normalization and controversy-level deductions are applied. The Morningstar Sustainability Rating is then assigned to all scored funds within Morningstar Categories in which at least ten (10) funds receive a Portfolio Sustainability Score and is determined by each fund's rank within the following distribution: High (highest 10%); Above Average (next 22.5%); Average (next 35%); Below Average (next 22.5%); Low (lowest 10%). The Morningstar Sustainability Rating is depicted by globe icons where High equals 5 globes and Low equals 1 globe. Since a Sustainability Rating is assigned to all funds that meet the above criteria, the rating it is not limited to funds with explicit sustainable or responsible investment mandates. Morningstar updates its Sustainability Ratings monthly. The Portfolio Sustainability Score is calculated when Morningstar receives a new portfolio. Then, the Sustainability Rating is calculated one month and six business days after the reported as-of date of the most recent portfolio. As part of the evaluation process, Morningstar uses Sustainalytics’ ESG scores from the same month as the portfolio as-of date. Please go here for more detailed information about the Morningstar Sustainability Rating methodology and calculation frequency.

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