By: Manisha Sethi Jul. 16, 2018

G2 Investment Partners Management LLC disclosed its SEC 13F filings for Q1 2018 on May 15 and reported a portfolio value of $254.22 million, with its top 10 holdings constituting 46.24%. The firm purchased 29 new stocks in the latest quarter. G2 Investment Partners Management LLC’s top holdings include USA Technologies, Inc. (USAT), QuinStreet, Inc. (QNST), Varonis Systems, Inc. (VRNS), LendingTree, Inc. (TREE), and Upland Software, Inc. (UPLD). G2 Investment Partners Management was founded by Josh Goldberg in 2009 and is based in New York. The firm invests across diverse sectors and operates as an investment management firm. The Company provides investment advisory services to pooled investment vehicles. It focuses on small- and mid-cap companies and employs a fundamental bottom-up approach to select its stocks for investment and pursues long-short equity strategies.

Raltin analyzed new purchases by G2 Investment Partners Management LLC from Q1 2014 to Q1 2018 and calculated their annual internal rate of return. Of the 216 new purchases, 117 stocks outperform S&P 500, while 99 underperform the index. More specifically, 74 new buys outperform the index by more than 20% and only 55 underperform by more than 20%. Detailed background on Raltin’s methodology can be found here. The following table shows the number of new purchases according to the S&P 500 performance categories.

S&P outperformance categoryNumber of new stock purchasesTotal new purchases (%)
10 to 20%198.8
0 to 10%2411.11
-10 to 0%2411.11
-20 to -10%209.26
Total stocks216

G2 Investment Partners Management bought 29 stocks from various sectors. In particular, Mellanox Technologies, Ltd. (MLNX) from the IT sector and Bandwidth Inc. (BAND) from the communications sector account for 2.41% and 1.96% of the portfolio. The next table lists the top 20 new buys along with the number of shares and their holding value.

StocksNumber of sharesHolding value ($1,000)
Mellanox Technologies, Ltd. (MLNX)84,2436,137
Bandwidth Inc. (BAND)1,52,3954,977
SailPoint Technologies Holdings, Inc. (SAIL)2,24,7404,650
Weight Watchers International, Inc. (WTW)58,3243,716
Copart, Inc. (CPRT)71,9373,664
Everbridge, Inc. (EVBG)92,4983,385
Proofpoint, Inc. (PFPT)27,4373,118
Zscaler, Inc. (ZS)1,05,1002,950
Zendesk Inc. (ZEN)49,2032,355
Splunk Inc. (SPLK)19,6151,930
GoDaddy Inc. (GDDY)31,0551,907
ORBCOMM Inc. (ORBC)1,84,7581,731
American Public Education, Inc. (APEI)37,0001,591
Astro-Med, Inc. (ALOT)94,1751,460
New Relic, Inc. (NEWR)19,0001,408
Mimecast Limited (MIME)39,5991,403
Resonant Inc. (RESN)3,93,8001,256 Ltd. (WIX)14,0701,119
Yext, Inc. (YEXT)77,666982

The following table presents G2 Investment Partners Management LLC’s portfolio value from Q1 2017 to Q1 2016. In addition, it shows the top holdings that outperform S&P 500 for each quarter. The data suggest that, among the new purchases, Electro Scientific Industries, Inc. (ESIO), Mercury Systems, Inc. (MRCY), Ultra Clean Holdings, Inc. (UCTT), and SodaStream International, Ltd. (SODA) outperform S&P 500 by a significant margin.

PeriodTotal portfolio value ($Mn)Top holdings (ticker, % of IRR difference from S&P 500)
Q1 2017252.39Electro Scientific Industries, Inc. (ESIO, 166.45), Alteryx Inc. (AYX, 107.23), Novanta Inc. (NOVT, 85.13)
Q4 2016267.83Mercury Systems, Inc. (MRCY, 50.73), NutriSystem, Inc. (NTRI, 32.54), Barracuda Networks, Inc. (CUDA, 8.97)
Q3 2016225.25Ultra Clean Holdings, Inc. (UCTT, 298.64), Chegg, Inc. (CHGG, 93.54), FormFactor, Inc. (FORM, 39.29)
Q2 2016216.67SodaStream International, Ltd. (SODA, 135.49), Coherent, Inc. (COHR, 129.71), AxoGen, Inc. (AXGN, 128.03)
Q1 2016278.9Lumentum Holdings Inc. (LITE, 83.11), Semtech Corp. (SMTC, 39.0), MaxLinear, Inc. (MXL, 36.92)