By: Manisha Sethi May. 11, 2018

Moody Aldrich  Partners LLC reported its SEC 13F filings for the fourth quarter of 2017 on January 31, 2018. Interestingly,  the top 10 stocks of the firm only account for 22% of its total portfolio value of $123.41 million. Moody Aldrich  Partners invests across sectors, and its top stocks include American Woodmark Corp. (AMWD), Wintrust Financial Corp. (WTFC), Silicon Laboratories, Inc. (SLAB),  Entegris, Inc. (ENTG) and Essent Group Ltd. (ESNT). In fact, AMWD constitutes 2.81% of its portfolio. Moody Aldrich Partners LLC was founded in 1988 by William Bradford Moody and  Eli Seth Kent and is based in Marblehead, Massachusetts. Formerly known as Moody Aldrich & Sullivan, LLC, the firm primarily provides its services to wrap, other institutions, partnership firms, UMA programs, and state or municipal government entities. It also caters to high net worth individuals, banking or thrift institutions, investment companies, pension and profit-sharing plans, pooled investment vehicles, charitable organizations, and corporations. The firm manages separate client-focused equity portfolios. It also invests in the public equity markets in value stocks of small-cap, mid-cap, and large-cap companies. The firm relies on fundamental analysis with a bottom-up stock picking approach. It employs a long-only strategy to make its investments and also uses qualitative analysis and in-house research to create its portfolios.

According to the Raltin, around 53% or 66 new stock buys of Moody Aldrich Partners LLC, have outperformed the S&P 500, out of which 30 new stocks have beaten the S&P 500 by more than 20%. Only 21% or 26 new buys out of 124 (between Q1 2014 & Q4 2017) underperformed the S&P 500 by the same percentage. Raltin’s detailed methodology for calculating the S&P 500 outperformance is given here. The below table shows the number of new stock purchases according to their performance against the S&P index.

S&P outperformance categoryNumber of new stock purchasesTotal new purchases (% )
>20%3024
10 to 20%2117
0 to 10%1512
-10 to 0%2319
-20 to -10%97
<-20%2621
Total stocks124


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The investor bought 12 new stocks in Q4 2017 from various sectors. Columbia Banking System, Inc. (COLB) and Centerstate Banks, Inc. (CSFL) from the finance sector account for 1.92% and 1.53% of the portfolio, respectively. The table below lists all the new buys by the investor in this quarter along with the number of shares bought and the holding value.

StocksNumber of sharesHolding value ($1,000)
Columbia Banking System, Inc. (COLB)54,5942,372
Centerstate Banks, Inc. (CSFL)73,1911,883
OM Asset Management Plc (OMAM)92,3691,547
US Ecology, Inc. (ECOL)24,7301,261
NorthWestern Corp. (NWE)20,4671,222
Solaris Oilfield Infrastructure (SOI)47,3361,013
Hawaiian Holdings, Inc. (HA)23,816949
AnaptysBio, Inc. (ANAB)9,290936
Ferro Corp. (FOE)37,480884
Lumentum Holdings Inc. (LITE)9,733476
Sun Communities, Inc. (SUI)2,286212
Broadridge Financial Solutions, Inc. (BR)2,249204

The following table shows the portfolio value of the fund for 5 quarters starting from Q1 2017 to Q1 2016, along with the top holdings in each quarter that outperformed the S&P 500. EXACT Sciences Corp. (EXAS), Kennametal Inc. (KMT), Clovis Oncology, Inc. (CLVS), Advanced Energy Industries, Inc. (AEIS), Cabot Microelectronics Corp. (CCMP)  and many more have beaten the index by huge margins.

PeriodTotal portfolio value ($Mn)Top holdings (ticker, % IRR difference from S&P 500)
Q1 201758.4EXACT Sciences Corp. (EXAS, 59.34), Malibu Boats, Inc. (MBUU, 36.43), Summit Materials, Inc. (SUM, 10.95)
Q4 2016155.1Kennametal Inc. (KMT, 35.61), SVB Financial Group (SIVB, 16.86), Cypress Semiconductor Corp. (CY, 13.88)
Q3 2016143.63Clovis Oncology, Inc. (CLVS, 112.89), Insmed, Inc. (INSM, 99.2), Exelixis, Inc. (EXEL, 73.58)
Q2 2016121Advanced Energy Industries, Inc. (AEIS, 54.99), Ingevity Corp. (NGVT, 53.2), RPC, Inc. (RES, 14.71)
Q1 201647.54Cabot Microelectronics Corp. (CCMP, 72.56), MKS Instruments, Inc. (MKSI, 67.9), SVB Financial Group (SIVB, 67.65)