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 category||Number of new stock purchases||Total new purchases (% )|
|10 to 20%||21||17|
|0 to 10%||15||12|
|-10 to 0%||23||19|
|-20 to -10%||9||7|
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.
|Stocks||Number of shares||Holding value ($1,000)|
|Columbia Banking System, Inc. (COLB)||54,594||2,372|
|Centerstate Banks, Inc. (CSFL)||73,191||1,883|
|OM Asset Management Plc (OMAM)||92,369||1,547|
|US Ecology, Inc. (ECOL)||24,730||1,261|
|NorthWestern Corp. (NWE)||20,467||1,222|
|Solaris Oilfield Infrastructure (SOI)||47,336||1,013|
|Hawaiian Holdings, Inc. (HA)||23,816||949|
|AnaptysBio, Inc. (ANAB)||9,290||936|
|Ferro Corp. (FOE)||37,480||884|
|Lumentum Holdings Inc. (LITE)||9,733||476|
|Sun Communities, Inc. (SUI)||2,286||212|
|Broadridge Financial Solutions, Inc. (BR)||2,249||204|
The following table shows the portfolio value of the fund for 5 quarters starting from Q1 2017 to Q1 2016, along with the top holdings in each quarter that outperformed the S&P 500. EXACT Sciences Corp. (EXAS), Kennametal Inc. (KMT), Clovis Oncology, Inc. (CLVS), Advanced Energy Industries, Inc. (AEIS), Cabot Microelectronics Corp. (CCMP) and many more have beaten the index by huge margins.
|Period||Total portfolio value ($Mn)||Top holdings (ticker, % IRR difference from S&P 500)|
|Q1 2017||58.4||EXACT Sciences Corp. (EXAS, 59.34), Malibu Boats, Inc. (MBUU, 36.43), Summit Materials, Inc. (SUM, 10.95)|
|Q4 2016||155.1||Kennametal Inc. (KMT, 35.61), SVB Financial Group (SIVB, 16.86), Cypress Semiconductor Corp. (CY, 13.88)|
|Q3 2016||143.63||Clovis Oncology, Inc. (CLVS, 112.89), Insmed, Inc. (INSM, 99.2), Exelixis, Inc. (EXEL, 73.58)|
|Q2 2016||121||Advanced Energy Industries, Inc. (AEIS, 54.99), Ingevity Corp. (NGVT, 53.2), RPC, Inc. (RES, 14.71)|
|Q1 2016||47.54||Cabot Microelectronics Corp. (CCMP, 72.56), MKS Instruments, Inc. (MKSI, 67.9), SVB Financial Group (SIVB, 67.65)|