Four Undervalued Small-Cap Stocks: Jim Harvey in The Wall Street Transcript—Royce
article 04-19-2022

Four Undervalued Small-Cap Stocks: Jim Harvey in The Wall Street Transcript

Portfolio Manager Jim Harvey details small-cap stocks that may close the valuation gap in an interview with The Wall Street Transcript.

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Portfolio Manager Jim Harvey discusses the four themes Royce Opportunity Fund uses when looking for undervalued small-caps that have a catalyst that may close the valuation gap in The Wall Street Transcript.

Read the transcript (subscription required).

Jim discussed four companies and how each one fits into the portfolio’s themes: unrecognized asset values, stocks the team believes are turnarounds, undervalued growth companies, and companies with interrupted earnings—which are often what Jim and the portfolio management team call “broken IPOs.”

“It’s actually really good to see that the market is turning back to these value stocks,” Jim said. “They’ve continued to trade at historically low multiples, both value relative to growth as well as small relative to large. So hopefully that provides the backdrop for a pretty nice run from here.”

Read the transcript (subscription required).

Learn more about Jim Harvey.

Important Disclosure Information

Average Annual Total Returns as of 3/31/22 (%) 

  1Q221 1YR 3YR 5YR 10YR 15YR 20YR SINCE INCEPT. DATE
Opportunity Fund -4.71 -0.3 20.95 13.40 21.68 9.16 10.54 12.60 11/19/96
Russell 2000 Value -2.40 3.32 12.73 8.57 10.54 6.91 8.55 9.56 N/A
Russell 2000 -7.53 -5.79 11.74 9.74 11.04 7.99 8.72 8.72 N/A

Annual Operating Expenses: 1.23

1 Not annualized.

All performance information reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee, payable to the Fund which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. Operating expenses reflect the Fund's total annual operating expenses for the Investment Class as of the Fund's most current prospectus and include management fees and other expenses.

Mr. Harvey’s thoughts and opinions concerning the stock market are solely their own and, of course, there can be no assurance with regard to future market movements. No assurance can be given that the past performance trends as outlined above will continue in the future.

The performance data and trends outlined in this presentation are presented for illustrative purposes only. Past performance is no guarantee of future results. Historical market trends are not necessarily indicative of future market movements.

Percentage of Fund Holdings As of 3/31/2022 (%)

  Royce
Opportunity
Fund

Atlas Air Worldwide Holdings

0.5

Healthcare Services Group

0.3

Ichor Holdings

0.6

Entravision Communications Corporation

0.4

Company examples are for illustrative purposes only. This does not constitute a recommendation to buy or sell any stock. There can be no assurance that the securities mentioned in this piece will be included in any Fund’s portfolio in the future.

There can be no assurance that companies that currently pay a dividend will continue to do so in the future.

Sector weightings are determined using the Global Industry Classification Standard ("GICS"). GICS was developed by, and is the exclusive property of, Standard & Poor's Financial Services LLC ("S&P") and MSCI Inc. ("MSCI"). GICS is the trademark of S&P and MSCI. "Global Industry Classification Standard (GICS)" and "GICS Direct" are service marks of S&P and MSCI.

Frank Russell Company (“Russell”) is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. Neither Russell nor its licensors accept any liability for any errors or omissions in the Russell Indexes and / or Russell ratings or underlying data and no party may rely on any Russell Indexes and / or Russell ratings and / or underlying data contained in this communication. No further distribution of Russell Data is permitted without Russell’s express written consent. Russell does not promote, sponsor or endorse the content of this communication. The Russell 2000 is an unmanaged, capitalization-weighted index of domestic small-cap stocks. It measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 index. The Russell 2000 Value and Growth indexes consist of the respective value and growth stocks within the Russell 2000 as determined by Russell Investments. The performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index.

This material is not authorized for distribution unless preceded or accompanied by a current prospectus. Please read the prospectus carefully before investing or sending money. Smaller-cap stocks may involve considerably more risk than larger-cap stocks. (Please see "Primary Risks for Fund Investors" in the prospectus.) The Fund’s broadly diversified portfolio does not ensure a profit or guarantee against loss.

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