AGF U.S. Small-Mid Cap Equity Strategy
Approach
Fundamental, bottom up.
Cap
Small-Mid Cap
Benchmark
S&P MidCap 400 Index
Inception Date
June 1993
Key Reasons to Invest
1
For investors seeking growth opportunities offered by small and mid-cap U.S. equities.
2
Targets innovative companies found in the U.S. Small-Mid Cap space.
3
A complement to an existing U.S. equities exposure to drive additional growth.
Overview
Strategy
Bottom-up growth investment style that looks at a company's revenue and profitability as well as earnings quality and growth potential.
Philosophy
The team's objective is to capture leading growth companies in every investment cycle. Every stock the team holds is a buy each day, or it is sold. The team uses an opportunistic bottom-up approach with front-end quantitative screens to identify high-quality, small-mid cap U.S. growth companies that can successfully generate sustainable above-average growth for revenues, earnings and cash flow.
Investment Process
Our investment process employs a fundamental, bottom-up and macro-consideration approach. Our universe contains 1,900+ U.S. companies with market capitalizations greater than US$500 million. First, quantitative screens narrow the investible universe to 350+ stocks. Next, qualitative screens continue to narrow the investible universe to 200+ stocks. A catalyst identification further reduces the universe to 100+ companies, singling out potential purchase candidates.
In order to determine the optimal growth candidates, in-depth analysis and due diligence is performed for each company. This step confirms that these companies exhibit the potential for sustained growth as well as continued innovation in their products and services.
The resulting portfolio consists of 25-40 companies that exhibit strong growth characteristics. The typical range for position weights is 1-8%. There will be representation in at least 8 of the 11 GICS sectors comprising the U.S. equity market, as represented by the S&P MidCap 400 Index.
Our team's utilization of a bottom-up investment process results in a high conviction portfolio of 25 -40 stocks that exhibit above-average growth characteristics.
Investment Process
- Market cap greater than US$ 500 million
- 1,900+ stocks
-
1. Quantitative Screens
- Above average earnings and revenue growth
- Positive earnings revisions
- ROE
- Rising free cash flow
- Low debt/equity
- 350+ stocks
-
2. Fundamental Analysis
- Meeting management
- Identify secular trends
- New strategic initiatives
- New products or services
- Absolute and relative valuation metrics - P/E, P/S, P/B
- 200+ stocks
-
3. Initial Candidates Result of Catalyst Identification
- Research and development
- Potential market disruptors
- Culture
- Macro factors
- Partner developments
- 100+ stocks
- High conviction
- Leaders
- Innovation
- Macroeconomic
- Thematic trends
- 20 - 40 stocks
Investment Team
Tony Genua has been Portfolio Manager of AGF's U.S. growth strategies since he joined the firm in 2005. Throughout his career in portfolio management, Tony has remained committed to his proven investment strategy that identifies leading growth companies in every cycle. Tony is also a member of the AGF Asset Allocation Committee (AAC), which is comprised of senior portfolio managers who are responsible for various regions and asset classes. The AAC meets regularly to discuss, analyze and assess the macro-economic environment and capital markets in order to determine optimal asset allocation recommendations.
Tony's portfolio management experience includes retail mutual fund investments, sub-advisory platforms and institutional portfolios. Tony's direct experience as a portfolio manager is complemented by the three years he spent as a market strategist on Wall Street.
Tony earned his BA in Economics from the University of Western Ontario.
Portfolio Manager under AGF Investments Inc. and AGF Investments America Inc.
Sam Mitter is the Co-Portfolio Manager for AGF U.S. Small-Mid Cap Fund and the associated Separately Managed Account (SMA) as well as the Institutional AGF U.S. Small-Mid Cap Growth Equity strategy. In this role, he is responsible for assessing appropriate portfolio positioning and screening the universe of eligible stocks to identify purchase candidates. He also works closely with the research team to identify investment opportunities and monitors the fundamentals of existing holdings. He joined AGF in 2014 and has been working with Portfolio Manager Tony Genua on his mandates since 2016. Sam is also Associate Portfolio Manager on the AGF Global Select and AGF American Growth Fund mandates, and has gained experience as a member of the AGF Equity Research Team covering the Information Technology sector.
He has been actively involved in the investment industry for 20 years. Prior to joining AGF, Sam was Vice-President, Equities & Associate Portfolio Manager at Meadowbank Asset Management, where he was involved with venture capital and early-stage technology companies. He also gained experience with roles at Sentry Investments, Scotia Asset Management and Altamira Management Ltd.
Sam holds a B.Sc. from Culver-Stockton College and an MBA from Santa Clara University.
Portfolio Manager under AGF Investments Inc. and AGF Investments America Inc.
Abhishek Ashok
M.A., MFE, CFA®
Richard Fisher
M.A. (Econ.)
Georgina Goldring
CFA®
Ling Han
M.Sc., MBA, CFA®
Grace Huang
MBA, CFA®
John Kratochwil
MBA, P.Eng.
Henry Kwok
MBA
Lazar Naiker
Pulkit Sabharwal
MBA
Wai Tong
MBA, P.Eng., CFA®
Wyeth Wright
CFA®
Auritro Kundu
MBA
Jonathan Lo
MBA
The AGF Equity Analyst Team consists of individuals from AGF Investments Inc. Personnel of AGF Investment Inc., an affiliated adviser located in Canada that is not registered with the SEC, provide research services to clients of AGF Investments America Inc through an Affiliate Resource Arrangements.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.